Correlation Between Kaonmedia and Wonil Special
Can any of the company-specific risk be diversified away by investing in both Kaonmedia and Wonil Special 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 Kaonmedia and Wonil Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaonmedia Co and Wonil Special Steel, you can compare the effects of market volatilities on Kaonmedia and Wonil Special 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 Kaonmedia with a short position of Wonil Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaonmedia and Wonil Special.
Diversification Opportunities for Kaonmedia and Wonil Special
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kaonmedia and Wonil is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Kaonmedia Co and Wonil Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonil Special Steel and Kaonmedia 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 Kaonmedia Co are associated (or correlated) with Wonil Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonil Special Steel has no effect on the direction of Kaonmedia i.e., Kaonmedia and Wonil Special go up and down completely randomly.
Pair Corralation between Kaonmedia and Wonil Special
Assuming the 90 days trading horizon Kaonmedia Co is expected to under-perform the Wonil Special. In addition to that, Kaonmedia is 2.94 times more volatile than Wonil Special Steel. It trades about -0.03 of its total potential returns per unit of risk. Wonil Special Steel is currently generating about -0.04 per unit of volatility. If you would invest 982,092 in Wonil Special Steel on September 1, 2024 and sell it today you would lose (254,092) from holding Wonil Special Steel or give up 25.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaonmedia Co vs. Wonil Special Steel
Performance |
| Timeline |
| Kaonmedia |
| Wonil Special Steel |
Kaonmedia and Wonil Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaonmedia and Wonil Special
The main advantage of trading using opposite Kaonmedia and Wonil Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaonmedia position performs unexpectedly, Wonil Special 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 Wonil Special will offset losses from the drop in Wonil Special's long position.| Kaonmedia vs. Dongsin Engineering Construction | Kaonmedia vs. Doosan Fuel Cell | Kaonmedia vs. Daishin Balance 1 | Kaonmedia vs. Total Soft Bank |
| Wonil Special vs. LG Chemicals | Wonil Special vs. POSCO Holdings | Wonil Special vs. Hanwha Solutions | Wonil Special vs. Hyundai Steel |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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