Correlation Between AfreecaTV and Nice Information
Can any of the company-specific risk be diversified away by investing in both AfreecaTV and Nice Information 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 AfreecaTV and Nice Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AfreecaTV Co and Nice Information Telecommunication, you can compare the effects of market volatilities on AfreecaTV and Nice Information 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 AfreecaTV with a short position of Nice Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of AfreecaTV and Nice Information.
Diversification Opportunities for AfreecaTV and Nice Information
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AfreecaTV and Nice is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding AfreecaTV Co and Nice Information Telecommunica in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nice Information Tel and AfreecaTV 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 AfreecaTV Co are associated (or correlated) with Nice Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nice Information Tel has no effect on the direction of AfreecaTV i.e., AfreecaTV and Nice Information go up and down completely randomly.
Pair Corralation between AfreecaTV and Nice Information
Assuming the 90 days trading horizon AfreecaTV Co is expected to generate 5.26 times more return on investment than Nice Information. However, AfreecaTV is 5.26 times more volatile than Nice Information Telecommunication. It trades about 0.25 of its potential returns per unit of risk. Nice Information Telecommunication is currently generating about -0.16 per unit of risk. If you would invest 9,050,000 in AfreecaTV Co on August 29, 2024 and sell it today you would earn a total of 1,640,000 from holding AfreecaTV Co or generate 18.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AfreecaTV Co vs. Nice Information Telecommunica
Performance |
| Timeline |
| AfreecaTV |
| Nice Information Tel |
AfreecaTV and Nice Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AfreecaTV and Nice Information
The main advantage of trading using opposite AfreecaTV and Nice Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AfreecaTV position performs unexpectedly, Nice Information 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 Nice Information will offset losses from the drop in Nice Information's long position.| AfreecaTV vs. SS TECH | AfreecaTV vs. Busan Industrial Co | AfreecaTV vs. Busan Ind | AfreecaTV vs. Mirae Asset Daewoo |
| Nice Information vs. Korea Real Estate | Nice Information vs. Korea Ratings Co | Nice Information vs. IQuest Co | Nice Information vs. Wonbang Tech Co |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |