Correlation Between Kaonmedia and Barunson Entertainment
Can any of the company-specific risk be diversified away by investing in both Kaonmedia and Barunson Entertainment 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 Barunson Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaonmedia Co and Barunson Entertainment Arts, you can compare the effects of market volatilities on Kaonmedia and Barunson Entertainment 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 Barunson Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaonmedia and Barunson Entertainment.
Diversification Opportunities for Kaonmedia and Barunson Entertainment
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kaonmedia and Barunson is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Kaonmedia Co and Barunson Entertainment Arts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barunson Entertainment 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 Barunson Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barunson Entertainment has no effect on the direction of Kaonmedia i.e., Kaonmedia and Barunson Entertainment go up and down completely randomly.
Pair Corralation between Kaonmedia and Barunson Entertainment
Assuming the 90 days trading horizon Kaonmedia Co is expected to under-perform the Barunson Entertainment. In addition to that, Kaonmedia is 1.48 times more volatile than Barunson Entertainment Arts. It trades about -0.15 of its total potential returns per unit of risk. Barunson Entertainment Arts is currently generating about -0.1 per unit of volatility. If you would invest 49,100 in Barunson Entertainment Arts on August 25, 2024 and sell it today you would lose (5,400) from holding Barunson Entertainment Arts or give up 11.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaonmedia Co vs. Barunson Entertainment Arts
Performance |
| Timeline |
| Kaonmedia |
| Barunson Entertainment |
Kaonmedia and Barunson Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaonmedia and Barunson Entertainment
The main advantage of trading using opposite Kaonmedia and Barunson Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaonmedia position performs unexpectedly, Barunson Entertainment 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 Barunson Entertainment will offset losses from the drop in Barunson Entertainment's long position.| Kaonmedia vs. Konan Technology | Kaonmedia vs. Samji Electronics Co | Kaonmedia vs. SK Chemicals Co | Kaonmedia vs. Ilji Technology Co |
| Barunson Entertainment vs. Seoam Machinery Industry | Barunson Entertainment vs. GS Engineering Construction | Barunson Entertainment vs. Dongwoo Farm To | Barunson Entertainment vs. T3 Entertainment 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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