Correlation Between Ewon Comfortech and Raontech
Can any of the company-specific risk be diversified away by investing in both Ewon Comfortech and Raontech 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 Ewon Comfortech and Raontech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ewon Comfortech Co and Raontech, you can compare the effects of market volatilities on Ewon Comfortech and Raontech 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 Ewon Comfortech with a short position of Raontech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ewon Comfortech and Raontech.
Diversification Opportunities for Ewon Comfortech and Raontech
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ewon and Raontech is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Ewon Comfortech Co and Raontech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raontech and Ewon Comfortech 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 Ewon Comfortech Co are associated (or correlated) with Raontech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raontech has no effect on the direction of Ewon Comfortech i.e., Ewon Comfortech and Raontech go up and down completely randomly.
Pair Corralation between Ewon Comfortech and Raontech
Assuming the 90 days trading horizon Ewon Comfortech Co is expected to generate 0.71 times more return on investment than Raontech. However, Ewon Comfortech Co is 1.41 times less risky than Raontech. It trades about -0.04 of its potential returns per unit of risk. Raontech is currently generating about -0.34 per unit of risk. If you would invest 106,500 in Ewon Comfortech Co on November 4, 2024 and sell it today you would lose (2,000) from holding Ewon Comfortech Co or give up 1.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ewon Comfortech Co vs. Raontech
Performance |
| Timeline |
| Ewon Comfortech |
| Raontech |
Ewon Comfortech and Raontech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ewon Comfortech and Raontech
The main advantage of trading using opposite Ewon Comfortech and Raontech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ewon Comfortech position performs unexpectedly, Raontech 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 Raontech will offset losses from the drop in Raontech's long position.| Ewon Comfortech vs. Samsung Electronics Co | Ewon Comfortech vs. Samsung Electronics Co | Ewon Comfortech vs. Hyundai Motor Co | Ewon Comfortech vs. Hyundai Motor |
| Raontech vs. Choil Aluminum | Raontech vs. Heungkuk Metaltech CoLtd | Raontech vs. Sewoon Medical Co | Raontech vs. Daejung Chemicals Metals |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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