Correlation Between Infinitt Healthcare and LG Display
Can any of the company-specific risk be diversified away by investing in both Infinitt Healthcare and LG Display 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 Infinitt Healthcare and LG Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinitt Healthcare Co and LG Display Co, you can compare the effects of market volatilities on Infinitt Healthcare and LG Display 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 Infinitt Healthcare with a short position of LG Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinitt Healthcare and LG Display.
Diversification Opportunities for Infinitt Healthcare and LG Display
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Infinitt and 034220 is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Infinitt Healthcare Co and LG Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Display and Infinitt Healthcare 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 Infinitt Healthcare Co are associated (or correlated) with LG Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Display has no effect on the direction of Infinitt Healthcare i.e., Infinitt Healthcare and LG Display go up and down completely randomly.
Pair Corralation between Infinitt Healthcare and LG Display
Assuming the 90 days trading horizon Infinitt Healthcare Co is expected to generate 1.26 times more return on investment than LG Display. However, Infinitt Healthcare is 1.26 times more volatile than LG Display Co. It trades about 0.1 of its potential returns per unit of risk. LG Display Co is currently generating about -0.3 per unit of risk. If you would invest 434,000 in Infinitt Healthcare Co on September 3, 2024 and sell it today you would earn a total of 16,000 from holding Infinitt Healthcare Co or generate 3.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Infinitt Healthcare Co vs. LG Display Co
Performance |
| Timeline |
| Infinitt Healthcare |
| LG Display |
Infinitt Healthcare and LG Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinitt Healthcare and LG Display
The main advantage of trading using opposite Infinitt Healthcare and LG Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinitt Healthcare position performs unexpectedly, LG Display 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 LG Display will offset losses from the drop in LG Display's long position.| Infinitt Healthcare vs. AptaBio Therapeutics | Infinitt Healthcare vs. Daewoo SBI SPAC | Infinitt Healthcare vs. Dream Security co | Infinitt Healthcare vs. Microfriend |
| LG Display vs. AptaBio Therapeutics | LG Display vs. Daewoo SBI SPAC | LG Display vs. Dream Security co | LG Display vs. Microfriend |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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