Correlation Between AeroSpace Technology and KOSES CoLtd
Can any of the company-specific risk be diversified away by investing in both AeroSpace Technology and KOSES CoLtd 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 AeroSpace Technology and KOSES CoLtd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AeroSpace Technology of and KOSES CoLtd, you can compare the effects of market volatilities on AeroSpace Technology and KOSES CoLtd 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 AeroSpace Technology with a short position of KOSES CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of AeroSpace Technology and KOSES CoLtd.
Diversification Opportunities for AeroSpace Technology and KOSES CoLtd
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between AeroSpace and KOSES is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding AeroSpace Technology of and KOSES CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KOSES CoLtd and AeroSpace Technology 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 AeroSpace Technology of are associated (or correlated) with KOSES CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KOSES CoLtd has no effect on the direction of AeroSpace Technology i.e., AeroSpace Technology and KOSES CoLtd go up and down completely randomly.
Pair Corralation between AeroSpace Technology and KOSES CoLtd
Assuming the 90 days trading horizon AeroSpace Technology of is expected to under-perform the KOSES CoLtd. In addition to that, AeroSpace Technology is 1.37 times more volatile than KOSES CoLtd. It trades about -0.03 of its total potential returns per unit of risk. KOSES CoLtd is currently generating about -0.02 per unit of volatility. If you would invest 1,354,000 in KOSES CoLtd on September 12, 2024 and sell it today you would lose (656,000) from holding KOSES CoLtd or give up 48.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 96.19% |
| Values | Daily Returns |
AeroSpace Technology of vs. KOSES CoLtd
Performance |
| Timeline |
| AeroSpace Technology |
| KOSES CoLtd |
AeroSpace Technology and KOSES CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AeroSpace Technology and KOSES CoLtd
The main advantage of trading using opposite AeroSpace Technology and KOSES CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AeroSpace Technology position performs unexpectedly, KOSES CoLtd 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 KOSES CoLtd will offset losses from the drop in KOSES CoLtd's long position.| AeroSpace Technology vs. Korea New Network | AeroSpace Technology vs. Solution Advanced Technology | AeroSpace Technology vs. Busan Industrial Co | AeroSpace Technology vs. Busan Ind |
| KOSES CoLtd vs. Hyunwoo Industrial Co | KOSES CoLtd vs. Adaptive Plasma Technology | KOSES CoLtd vs. AeroSpace Technology of | KOSES CoLtd vs. Cots Technology 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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