Correlation Between Jeju Semiconductor and Mgame Corp
Can any of the company-specific risk be diversified away by investing in both Jeju Semiconductor and Mgame Corp 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 Mgame Corp 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 Mgame Corp, you can compare the effects of market volatilities on Jeju Semiconductor and Mgame Corp 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 Mgame Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeju Semiconductor and Mgame Corp.
Diversification Opportunities for Jeju Semiconductor and Mgame Corp
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Jeju and Mgame is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Jeju Semiconductor Corp and Mgame Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mgame Corp 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 Mgame Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mgame Corp has no effect on the direction of Jeju Semiconductor i.e., Jeju Semiconductor and Mgame Corp go up and down completely randomly.
Pair Corralation between Jeju Semiconductor and Mgame Corp
Assuming the 90 days trading horizon Jeju Semiconductor Corp is expected to under-perform the Mgame Corp. But the stock apears to be less risky and, when comparing its historical volatility, Jeju Semiconductor Corp is 1.88 times less risky than Mgame Corp. The stock trades about -0.48 of its potential returns per unit of risk. The Mgame Corp is currently generating about -0.11 of returns per unit of risk over similar time horizon. If you would invest 630,000 in Mgame Corp on August 31, 2024 and sell it today you would lose (85,000) from holding Mgame Corp or give up 13.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeju Semiconductor Corp vs. Mgame Corp
Performance |
| Timeline |
| Jeju Semiconductor Corp |
| Mgame Corp |
Jeju Semiconductor and Mgame Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeju Semiconductor and Mgame Corp
The main advantage of trading using opposite Jeju Semiconductor and Mgame Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeju Semiconductor position performs unexpectedly, Mgame Corp 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 Mgame Corp will offset losses from the drop in Mgame Corp's long position.| Jeju Semiconductor vs. MNtech Co | Jeju Semiconductor vs. Lion Chemtech Co | Jeju Semiconductor vs. Eagle Veterinary Technology | Jeju Semiconductor vs. Stic Investments |
| Mgame Corp vs. AptaBio Therapeutics | Mgame Corp vs. Daewoo SBI SPAC | Mgame Corp vs. Dream Security co | Mgame Corp vs. Microfriend |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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