Correlation Between UJU Electronics and Tway Air
Can any of the company-specific risk be diversified away by investing in both UJU Electronics and Tway Air 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 UJU Electronics and Tway Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UJU Electronics Co and Tway Air Co, you can compare the effects of market volatilities on UJU Electronics and Tway Air 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 UJU Electronics with a short position of Tway Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of UJU Electronics and Tway Air.
Diversification Opportunities for UJU Electronics and Tway Air
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between UJU and Tway is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding UJU Electronics Co and Tway Air Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tway Air and UJU Electronics 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 UJU Electronics Co are associated (or correlated) with Tway Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tway Air has no effect on the direction of UJU Electronics i.e., UJU Electronics and Tway Air go up and down completely randomly.
Pair Corralation between UJU Electronics and Tway Air
Assuming the 90 days trading horizon UJU Electronics is expected to generate 1.45 times less return on investment than Tway Air. But when comparing it to its historical volatility, UJU Electronics Co is 1.36 times less risky than Tway Air. It trades about 0.52 of its potential returns per unit of risk. Tway Air Co is currently generating about 0.55 of returns per unit of risk over similar time horizon. If you would invest 248,500 in Tway Air Co on October 26, 2024 and sell it today you would earn a total of 150,500 from holding Tway Air Co or generate 60.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UJU Electronics Co vs. Tway Air Co
Performance |
| Timeline |
| UJU Electronics |
| Tway Air |
UJU Electronics and Tway Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UJU Electronics and Tway Air
The main advantage of trading using opposite UJU Electronics and Tway Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UJU Electronics position performs unexpectedly, Tway Air 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 Tway Air will offset losses from the drop in Tway Air's long position.| UJU Electronics vs. Samsung Electronics Co | UJU Electronics vs. Samsung Electronics Co | UJU Electronics vs. SK Hynix | UJU Electronics vs. HMM Co |
| Tway Air vs. Jin Air Co | Tway Air vs. Air Busan Co | Tway Air vs. Busan Industrial Co | Tway Air vs. Busan Ind |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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