Correlation Between ITM Semiconductor and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both ITM Semiconductor and Kukil Metal 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 ITM Semiconductor and Kukil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ITM Semiconductor Co and Kukil Metal Co, you can compare the effects of market volatilities on ITM Semiconductor and Kukil Metal 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 ITM Semiconductor with a short position of Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITM Semiconductor and Kukil Metal.
Diversification Opportunities for ITM Semiconductor and Kukil Metal
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ITM and Kukil is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding ITM Semiconductor Co and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal and ITM 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 ITM Semiconductor Co are associated (or correlated) with Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of ITM Semiconductor i.e., ITM Semiconductor and Kukil Metal go up and down completely randomly.
Pair Corralation between ITM Semiconductor and Kukil Metal
Assuming the 90 days trading horizon ITM Semiconductor Co is expected to under-perform the Kukil Metal. But the stock apears to be less risky and, when comparing its historical volatility, ITM Semiconductor Co is 1.31 times less risky than Kukil Metal. The stock trades about -0.02 of its potential returns per unit of risk. The Kukil Metal Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 289,238 in Kukil Metal Co on September 2, 2024 and sell it today you would lose (113,538) from holding Kukil Metal Co or give up 39.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ITM Semiconductor Co vs. Kukil Metal Co
Performance |
| Timeline |
| ITM Semiconductor |
| Kukil Metal |
ITM Semiconductor and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITM Semiconductor and Kukil Metal
The main advantage of trading using opposite ITM Semiconductor and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITM Semiconductor position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| ITM Semiconductor vs. SK Hynix | ITM Semiconductor vs. LX Semicon Co | ITM Semiconductor vs. People Technology | ITM Semiconductor vs. SIMMTECH Co |
| Kukil Metal vs. Keum Kang Steel | Kukil Metal vs. Tplex Co | Kukil Metal vs. Jeil Steel Mfg | Kukil Metal vs. Daedong Steel 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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