Correlation Between Tokai Carbon and LX Semicon
Can any of the company-specific risk be diversified away by investing in both Tokai Carbon and LX Semicon at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Tokai Carbon and LX Semicon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tokai Carbon Korea and LX Semicon Co, you can compare the effects of market volatilities on Tokai Carbon and LX Semicon and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Tokai Carbon with a short position of LX Semicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tokai Carbon and LX Semicon.
Diversification Opportunities for Tokai Carbon and LX Semicon
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tokai and 108320 is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Tokai Carbon Korea and LX Semicon Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LX Semicon and Tokai Carbon is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Tokai Carbon Korea are associated (or correlated) with LX Semicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LX Semicon has no effect on the direction of Tokai Carbon i.e., Tokai Carbon and LX Semicon go up and down completely randomly.
Pair Corralation between Tokai Carbon and LX Semicon
Assuming the 90 days trading horizon Tokai Carbon Korea is expected to generate 1.08 times more return on investment than LX Semicon. However, Tokai Carbon is 1.08 times more volatile than LX Semicon Co. It trades about 0.0 of its potential returns per unit of risk. LX Semicon Co is currently generating about -0.02 per unit of risk. If you would invest 10,003,800 in Tokai Carbon Korea on November 27, 2024 and sell it today you would lose (1,153,800) from holding Tokai Carbon Korea or give up 11.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tokai Carbon Korea vs. LX Semicon Co
Performance |
| Timeline |
| Tokai Carbon Korea |
| LX Semicon |
Tokai Carbon and LX Semicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tokai Carbon and LX Semicon
The main advantage of trading using opposite Tokai Carbon and LX Semicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tokai Carbon position performs unexpectedly, LX Semicon can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LX Semicon will offset losses from the drop in LX Semicon's long position.| Tokai Carbon vs. LEENO Industrial | Tokai Carbon vs. Wonik Ips Co | Tokai Carbon vs. Dongjin Semichem Co | Tokai Carbon vs. Hana Materials |
| LX Semicon vs. CKH Food Health | LX Semicon vs. LG Household Healthcare | LX Semicon vs. Sam Yang Foods | LX Semicon vs. Alton Sports CoLtd |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |