Correlation Between Global Standard and Insung Information
Can any of the company-specific risk be diversified away by investing in both Global Standard and Insung Information 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 Global Standard and Insung Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Standard Technology and Insung Information Co, you can compare the effects of market volatilities on Global Standard and Insung Information 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 Global Standard with a short position of Insung Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Standard and Insung Information.
Diversification Opportunities for Global Standard and Insung Information
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Global and Insung is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Global Standard Technology and Insung Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insung Information and Global Standard 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 Global Standard Technology are associated (or correlated) with Insung Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insung Information has no effect on the direction of Global Standard i.e., Global Standard and Insung Information go up and down completely randomly.
Pair Corralation between Global Standard and Insung Information
Assuming the 90 days trading horizon Global Standard Technology is expected to generate 0.87 times more return on investment than Insung Information. However, Global Standard Technology is 1.14 times less risky than Insung Information. It trades about 0.05 of its potential returns per unit of risk. Insung Information Co is currently generating about 0.01 per unit of risk. If you would invest 1,023,159 in Global Standard Technology on August 25, 2024 and sell it today you would earn a total of 454,841 from holding Global Standard Technology or generate 44.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Standard Technology vs. Insung Information Co
Performance |
| Timeline |
| Global Standard Tech |
| Insung Information |
Global Standard and Insung Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Standard and Insung Information
The main advantage of trading using opposite Global Standard and Insung Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Standard position performs unexpectedly, Insung Information 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 Insung Information will offset losses from the drop in Insung Information's long position.| Global Standard vs. Insung Information Co | Global Standard vs. Korea Information Engineering | Global Standard vs. Lotte Data Communication | Global Standard vs. Tuksu Engineering ConstructionLtd |
| Insung Information vs. SCI Information Service | Insung Information vs. Seoul Electronics Telecom | Insung Information vs. Ssangyong Information Communication | Insung Information vs. Samji Electronics 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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