Correlation Between Jeju Semiconductor and Bohae Brewery
Can any of the company-specific risk be diversified away by investing in both Jeju Semiconductor and Bohae Brewery 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 Jeju Semiconductor and Bohae Brewery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeju Semiconductor Corp and Bohae Brewery, you can compare the effects of market volatilities on Jeju Semiconductor and Bohae Brewery 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 Jeju Semiconductor with a short position of Bohae Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeju Semiconductor and Bohae Brewery.
Diversification Opportunities for Jeju Semiconductor and Bohae Brewery
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jeju and Bohae is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Jeju Semiconductor Corp and Bohae Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bohae Brewery and Jeju Semiconductor 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 Jeju Semiconductor Corp are associated (or correlated) with Bohae Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bohae Brewery has no effect on the direction of Jeju Semiconductor i.e., Jeju Semiconductor and Bohae Brewery go up and down completely randomly.
Pair Corralation between Jeju Semiconductor and Bohae Brewery
Assuming the 90 days trading horizon Jeju Semiconductor Corp is expected to under-perform the Bohae Brewery. But the stock apears to be less risky and, when comparing its historical volatility, Jeju Semiconductor Corp is 3.11 times less risky than Bohae Brewery. The stock trades about -0.6 of its potential returns per unit of risk. The Bohae Brewery is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 42,000 in Bohae Brewery on September 4, 2024 and sell it today you would earn a total of 3,200 from holding Bohae Brewery or generate 7.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeju Semiconductor Corp vs. Bohae Brewery
Performance |
| Timeline |
| Jeju Semiconductor Corp |
| Bohae Brewery |
Jeju Semiconductor and Bohae Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeju Semiconductor and Bohae Brewery
The main advantage of trading using opposite Jeju Semiconductor and Bohae Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeju Semiconductor position performs unexpectedly, Bohae Brewery 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 Bohae Brewery will offset losses from the drop in Bohae Brewery's long position.| Jeju Semiconductor vs. Dongsin Engineering Construction | Jeju Semiconductor vs. Doosan Fuel Cell | Jeju Semiconductor vs. Daishin Balance 1 | Jeju Semiconductor vs. Total Soft Bank |
| Bohae Brewery vs. LG Display | Bohae Brewery vs. Hyundai Motor | Bohae Brewery vs. Hyundai Motor Co | Bohae Brewery vs. Hyundai Motor 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |