Correlation Between Korea Investment and Jeong Moon
Can any of the company-specific risk be diversified away by investing in both Korea Investment and Jeong Moon 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 Korea Investment and Jeong Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Investment Holdings and Jeong Moon Information, you can compare the effects of market volatilities on Korea Investment and Jeong Moon 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 Korea Investment with a short position of Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Investment and Jeong Moon.
Diversification Opportunities for Korea Investment and Jeong Moon
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and Jeong is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Korea Investment Holdings and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information and Korea Investment 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 Korea Investment Holdings are associated (or correlated) with Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of Korea Investment i.e., Korea Investment and Jeong Moon go up and down completely randomly.
Pair Corralation between Korea Investment and Jeong Moon
Assuming the 90 days trading horizon Korea Investment Holdings is expected to under-perform the Jeong Moon. But the stock apears to be less risky and, when comparing its historical volatility, Korea Investment Holdings is 1.62 times less risky than Jeong Moon. The stock trades about -0.09 of its potential returns per unit of risk. The Jeong Moon Information is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 78,800 in Jeong Moon Information on October 12, 2024 and sell it today you would earn a total of 3,400 from holding Jeong Moon Information or generate 4.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Investment Holdings vs. Jeong Moon Information
Performance |
| Timeline |
| Korea Investment Holdings |
| Jeong Moon Information |
Korea Investment and Jeong Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Investment and Jeong Moon
The main advantage of trading using opposite Korea Investment and Jeong Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Investment position performs unexpectedly, Jeong Moon 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 Jeong Moon will offset losses from the drop in Jeong Moon's long position.| Korea Investment vs. KG Eco Technology | Korea Investment vs. Guyoung Technology Co | Korea Investment vs. BIT Computer Co | Korea Investment vs. Jeju Bank |
| Jeong Moon vs. Korea Investment Holdings | Jeong Moon vs. Chorokbaem Healthcare Co | Jeong Moon vs. Pureun Mutual Savings | Jeong Moon vs. Korea Shipbuilding Offshore |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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