Correlation Between Okins Electronics and HYBE
Can any of the company-specific risk be diversified away by investing in both Okins Electronics and HYBE 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 Okins Electronics and HYBE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Okins Electronics Co and HYBE Co, you can compare the effects of market volatilities on Okins Electronics and HYBE 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 Okins Electronics with a short position of HYBE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Okins Electronics and HYBE.
Diversification Opportunities for Okins Electronics and HYBE
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Okins and HYBE is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Okins Electronics Co and HYBE Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYBE and Okins Electronics 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 Okins Electronics Co are associated (or correlated) with HYBE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYBE has no effect on the direction of Okins Electronics i.e., Okins Electronics and HYBE go up and down completely randomly.
Pair Corralation between Okins Electronics and HYBE
Assuming the 90 days trading horizon Okins Electronics Co is expected to generate 1.49 times more return on investment than HYBE. However, Okins Electronics is 1.49 times more volatile than HYBE Co. It trades about 0.37 of its potential returns per unit of risk. HYBE Co is currently generating about 0.22 per unit of risk. If you would invest 457,000 in Okins Electronics Co on October 24, 2024 and sell it today you would earn a total of 103,000 from holding Okins Electronics Co or generate 22.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Okins Electronics Co vs. HYBE Co
Performance |
| Timeline |
| Okins Electronics |
| HYBE |
Okins Electronics and HYBE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Okins Electronics and HYBE
The main advantage of trading using opposite Okins Electronics and HYBE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Okins Electronics position performs unexpectedly, HYBE 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 HYBE will offset losses from the drop in HYBE's long position.| Okins Electronics vs. Daishin Balance No8 | Okins Electronics vs. NAU IB Capital | Okins Electronics vs. Daishin Balance No | Okins Electronics vs. Daesung Private Equity |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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