Correlation Between Lotte Rental and Nh Investment
Can any of the company-specific risk be diversified away by investing in both Lotte Rental and Nh 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 Lotte Rental and Nh Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Rental Co and Nh Investment And, you can compare the effects of market volatilities on Lotte Rental and Nh 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 Lotte Rental with a short position of Nh Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Rental and Nh Investment.
Diversification Opportunities for Lotte Rental and Nh Investment
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lotte and 005945 is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Rental Co and Nh Investment And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nh Investment And and Lotte Rental 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 Lotte Rental Co are associated (or correlated) with Nh Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nh Investment And has no effect on the direction of Lotte Rental i.e., Lotte Rental and Nh Investment go up and down completely randomly.
Pair Corralation between Lotte Rental and Nh Investment
Assuming the 90 days trading horizon Lotte Rental Co is expected to under-perform the Nh Investment. In addition to that, Lotte Rental is 2.7 times more volatile than Nh Investment And. It trades about -0.27 of its total potential returns per unit of risk. Nh Investment And is currently generating about 0.56 per unit of volatility. If you would invest 1,216,000 in Nh Investment And on October 29, 2024 and sell it today you would earn a total of 64,000 from holding Nh Investment And or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Rental Co vs. Nh Investment And
Performance |
| Timeline |
| Lotte Rental |
| Nh Investment And |
Lotte Rental and Nh Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Rental and Nh Investment
The main advantage of trading using opposite Lotte Rental and Nh Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Rental position performs unexpectedly, Nh 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 Nh Investment will offset losses from the drop in Nh Investment's long position.| Lotte Rental vs. FOODWELL Co | Lotte Rental vs. Hankukpackage Co | Lotte Rental vs. Samyang Foods Co | Lotte Rental vs. ITM Semiconductor Co |
| Nh Investment vs. Shinsegae Food | Nh Investment vs. Alton Sports CoLtd | Nh Investment vs. Playgram Co | Nh Investment vs. Daiyang Metal 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |