Correlation Between Kaonmedia and FNC Entertainment
Can any of the company-specific risk be diversified away by investing in both Kaonmedia and FNC 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 FNC 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 FNC Entertainment Co, you can compare the effects of market volatilities on Kaonmedia and FNC 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 FNC Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaonmedia and FNC Entertainment.
Diversification Opportunities for Kaonmedia and FNC Entertainment
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kaonmedia and FNC is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Kaonmedia Co and FNC Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FNC 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 FNC Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FNC Entertainment has no effect on the direction of Kaonmedia i.e., Kaonmedia and FNC Entertainment go up and down completely randomly.
Pair Corralation between Kaonmedia and FNC Entertainment
Assuming the 90 days trading horizon Kaonmedia Co is expected to generate 1.13 times more return on investment than FNC Entertainment. However, Kaonmedia is 1.13 times more volatile than FNC Entertainment Co. It trades about -0.01 of its potential returns per unit of risk. FNC Entertainment Co is currently generating about -0.14 per unit of risk. If you would invest 352,000 in Kaonmedia Co on August 31, 2024 and sell it today you would lose (6,000) from holding Kaonmedia Co or give up 1.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaonmedia Co vs. FNC Entertainment Co
Performance |
| Timeline |
| Kaonmedia |
| FNC Entertainment |
Kaonmedia and FNC Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaonmedia and FNC Entertainment
The main advantage of trading using opposite Kaonmedia and FNC Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaonmedia position performs unexpectedly, FNC 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 FNC Entertainment will offset losses from the drop in FNC Entertainment's long position.| Kaonmedia vs. Dongsin Engineering Construction | Kaonmedia vs. Doosan Fuel Cell | Kaonmedia vs. Daishin Balance 1 | Kaonmedia vs. Total Soft Bank |
| FNC Entertainment vs. Green Cross Medical | FNC Entertainment vs. Konan Technology | FNC Entertainment vs. Korea Shipbuilding Offshore | FNC Entertainment vs. BGF Retail 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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