Correlation Between Jeju Air and Atinum Investment
Can any of the company-specific risk be diversified away by investing in both Jeju Air and Atinum Investment 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 Air and Atinum Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeju Air Co and Atinum Investment Co, you can compare the effects of market volatilities on Jeju Air and Atinum Investment 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 Air with a short position of Atinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeju Air and Atinum Investment.
Diversification Opportunities for Jeju Air and Atinum Investment
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jeju and Atinum is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Jeju Air Co and Atinum Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atinum Investment and Jeju Air 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 Air Co are associated (or correlated) with Atinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atinum Investment has no effect on the direction of Jeju Air i.e., Jeju Air and Atinum Investment go up and down completely randomly.
Pair Corralation between Jeju Air and Atinum Investment
Assuming the 90 days trading horizon Jeju Air Co is expected to under-perform the Atinum Investment. In addition to that, Jeju Air is 1.05 times more volatile than Atinum Investment Co. It trades about -0.01 of its total potential returns per unit of risk. Atinum Investment Co is currently generating about 0.27 per unit of volatility. If you would invest 209,000 in Atinum Investment Co on November 29, 2024 and sell it today you would earn a total of 11,500 from holding Atinum Investment Co or generate 5.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Jeju Air Co vs. Atinum Investment Co
Performance |
| Timeline |
| Jeju Air |
| Atinum Investment |
Jeju Air and Atinum Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeju Air and Atinum Investment
The main advantage of trading using opposite Jeju Air and Atinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeju Air position performs unexpectedly, Atinum Investment 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 Atinum Investment will offset losses from the drop in Atinum Investment's long position.| Jeju Air vs. Iljin Materials Co | Jeju Air vs. SV Investment | Jeju Air vs. Lotte Energy Materials | Jeju Air vs. Clean Science co |
| Atinum Investment vs. Samhyun Steel Co | Atinum Investment vs. Korean Air Lines | Atinum Investment vs. Dongbu Insurance Co | Atinum Investment vs. Lotte Chilsung Beverage |
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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