Correlation Between INFINITT Healthcare and Incar Financial
Can any of the company-specific risk be diversified away by investing in both INFINITT Healthcare and Incar Financial 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 Incar Financial 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 Incar Financial Service, you can compare the effects of market volatilities on INFINITT Healthcare and Incar Financial 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 Incar Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of INFINITT Healthcare and Incar Financial.
Diversification Opportunities for INFINITT Healthcare and Incar Financial
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between INFINITT and Incar is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding INFINITT Healthcare Co and Incar Financial Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Incar Financial Service 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 Incar Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Incar Financial Service has no effect on the direction of INFINITT Healthcare i.e., INFINITT Healthcare and Incar Financial go up and down completely randomly.
Pair Corralation between INFINITT Healthcare and Incar Financial
Assuming the 90 days trading horizon INFINITT Healthcare is expected to generate 3.55 times less return on investment than Incar Financial. But when comparing it to its historical volatility, INFINITT Healthcare Co is 2.28 times less risky than Incar Financial. It trades about 0.14 of its potential returns per unit of risk. Incar Financial Service is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 539,000 in Incar Financial Service on September 1, 2024 and sell it today you would earn a total of 104,000 from holding Incar Financial Service or generate 19.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
INFINITT Healthcare Co vs. Incar Financial Service
Performance |
| Timeline |
| INFINITT Healthcare |
| Incar Financial Service |
INFINITT Healthcare and Incar Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INFINITT Healthcare and Incar Financial
The main advantage of trading using opposite INFINITT Healthcare and Incar Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INFINITT Healthcare position performs unexpectedly, Incar Financial 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 Incar Financial will offset losses from the drop in Incar Financial's long position.| INFINITT Healthcare vs. Netmarble Games Corp | INFINITT Healthcare vs. Kukdong Oil Chemicals | INFINITT Healthcare vs. Miwon Chemicals Co | INFINITT Healthcare vs. TJ media Co |
| Incar Financial vs. Busan Industrial Co | Incar Financial vs. Busan Ind | Incar Financial vs. Mirae Asset Daewoo | Incar Financial vs. Finebesteel |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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