Correlation Between Theragen Etex and Cheryong Industrial
Can any of the company-specific risk be diversified away by investing in both Theragen Etex and Cheryong Industrial 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 Theragen Etex and Cheryong Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Theragen Etex CoLtd and Cheryong Industrial CoLtd, you can compare the effects of market volatilities on Theragen Etex and Cheryong Industrial 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 Theragen Etex with a short position of Cheryong Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Theragen Etex and Cheryong Industrial.
Diversification Opportunities for Theragen Etex and Cheryong Industrial
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Theragen and Cheryong is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Theragen Etex CoLtd and Cheryong Industrial CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheryong Industrial CoLtd and Theragen Etex 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 Theragen Etex CoLtd are associated (or correlated) with Cheryong Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheryong Industrial CoLtd has no effect on the direction of Theragen Etex i.e., Theragen Etex and Cheryong Industrial go up and down completely randomly.
Pair Corralation between Theragen Etex and Cheryong Industrial
Assuming the 90 days trading horizon Theragen Etex CoLtd is expected to under-perform the Cheryong Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Theragen Etex CoLtd is 6.58 times less risky than Cheryong Industrial. The stock trades about -0.1 of its potential returns per unit of risk. The Cheryong Industrial CoLtd is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 554,000 in Cheryong Industrial CoLtd on October 26, 2024 and sell it today you would earn a total of 145,000 from holding Cheryong Industrial CoLtd or generate 26.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Theragen Etex CoLtd vs. Cheryong Industrial CoLtd
Performance |
| Timeline |
| Theragen Etex CoLtd |
| Cheryong Industrial CoLtd |
Theragen Etex and Cheryong Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Theragen Etex and Cheryong Industrial
The main advantage of trading using opposite Theragen Etex and Cheryong Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Theragen Etex position performs unexpectedly, Cheryong Industrial 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 Cheryong Industrial will offset losses from the drop in Cheryong Industrial's long position.| Theragen Etex vs. Neungyule Education | Theragen Etex vs. Sangsangin Investment Securities | Theragen Etex vs. Nh Investment And | Theragen Etex vs. Hannong Chemicals |
| Cheryong Industrial vs. Sung Bo Chemicals | Cheryong Industrial vs. Youngchang Chemical Co | Cheryong Industrial vs. Playgram Co | Cheryong Industrial vs. SH Energy Chemical |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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