Correlation Between Jeju Air and Mirai Semiconductors
Can any of the company-specific risk be diversified away by investing in both Jeju Air and Mirai Semiconductors 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 Mirai Semiconductors 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 Mirai Semiconductors Co, you can compare the effects of market volatilities on Jeju Air and Mirai Semiconductors 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 Mirai Semiconductors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeju Air and Mirai Semiconductors.
Diversification Opportunities for Jeju Air and Mirai Semiconductors
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jeju and Mirai is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Jeju Air Co and Mirai Semiconductors Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirai Semiconductors 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 Mirai Semiconductors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirai Semiconductors has no effect on the direction of Jeju Air i.e., Jeju Air and Mirai Semiconductors go up and down completely randomly.
Pair Corralation between Jeju Air and Mirai Semiconductors
Assuming the 90 days trading horizon Jeju Air Co is expected to under-perform the Mirai Semiconductors. But the stock apears to be less risky and, when comparing its historical volatility, Jeju Air Co is 1.11 times less risky than Mirai Semiconductors. The stock trades about -0.25 of its potential returns per unit of risk. The Mirai Semiconductors Co is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,040,000 in Mirai Semiconductors Co on October 11, 2024 and sell it today you would earn a total of 192,000 from holding Mirai Semiconductors Co or generate 18.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeju Air Co vs. Mirai Semiconductors Co
Performance |
| Timeline |
| Jeju Air |
| Mirai Semiconductors |
Jeju Air and Mirai Semiconductors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeju Air and Mirai Semiconductors
The main advantage of trading using opposite Jeju Air and Mirai Semiconductors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeju Air position performs unexpectedly, Mirai Semiconductors 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 Mirai Semiconductors will offset losses from the drop in Mirai Semiconductors' long position.| Jeju Air vs. Kolon Plastics | Jeju Air vs. INNOX Advanced Materials | Jeju Air vs. Lotte Chilsung Beverage | Jeju Air vs. Digital Power Communications |
| Mirai Semiconductors vs. Samwha Electronics Co | Mirai Semiconductors vs. Tway Air Co | Mirai Semiconductors vs. Infinitt Healthcare Co | Mirai Semiconductors vs. Jeju Air 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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