Correlation Between Pyung Hwa and Mobile Appliance
Can any of the company-specific risk be diversified away by investing in both Pyung Hwa and Mobile Appliance 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 Pyung Hwa and Mobile Appliance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pyung Hwa Industrial and Mobile Appliance, you can compare the effects of market volatilities on Pyung Hwa and Mobile Appliance 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 Pyung Hwa with a short position of Mobile Appliance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pyung Hwa and Mobile Appliance.
Diversification Opportunities for Pyung Hwa and Mobile Appliance
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Pyung and Mobile is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Pyung Hwa Industrial and Mobile Appliance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Appliance and Pyung Hwa 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 Pyung Hwa Industrial are associated (or correlated) with Mobile Appliance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Appliance has no effect on the direction of Pyung Hwa i.e., Pyung Hwa and Mobile Appliance go up and down completely randomly.
Pair Corralation between Pyung Hwa and Mobile Appliance
Assuming the 90 days trading horizon Pyung Hwa Industrial is expected to generate 0.72 times more return on investment than Mobile Appliance. However, Pyung Hwa Industrial is 1.39 times less risky than Mobile Appliance. It trades about 0.01 of its potential returns per unit of risk. Mobile Appliance is currently generating about -0.13 per unit of risk. If you would invest 91,200 in Pyung Hwa Industrial on September 23, 2024 and sell it today you would lose (100.00) from holding Pyung Hwa Industrial or give up 0.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pyung Hwa Industrial vs. Mobile Appliance
Performance |
| Timeline |
| Pyung Hwa Industrial |
| Mobile Appliance |
Pyung Hwa and Mobile Appliance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pyung Hwa and Mobile Appliance
The main advantage of trading using opposite Pyung Hwa and Mobile Appliance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pyung Hwa position performs unexpectedly, Mobile Appliance 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 Mobile Appliance will offset losses from the drop in Mobile Appliance's long position.| Pyung Hwa vs. AptaBio Therapeutics | Pyung Hwa vs. Wonbang Tech Co | Pyung Hwa vs. Busan Industrial Co | Pyung Hwa vs. Busan Ind |
| Mobile Appliance vs. Eagon Industrial Co | Mobile Appliance vs. Pyung Hwa Industrial | Mobile Appliance vs. Myoung Shin Industrial | Mobile Appliance vs. Daelim Industrial 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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