Correlation Between Tway Air and Korea Air
Can any of the company-specific risk be diversified away by investing in both Tway Air and Korea Air 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 Tway Air and Korea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tway Air Co and Korea Air Svc, you can compare the effects of market volatilities on Tway Air and Korea Air 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 Tway Air with a short position of Korea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tway Air and Korea Air.
Diversification Opportunities for Tway Air and Korea Air
Average diversification
The 3 months correlation between Tway and Korea is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Tway Air Co and Korea Air Svc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Air Svc and Tway 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 Tway Air Co are associated (or correlated) with Korea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Air Svc has no effect on the direction of Tway Air i.e., Tway Air and Korea Air go up and down completely randomly.
Pair Corralation between Tway Air and Korea Air
Assuming the 90 days trading horizon Tway Air Co is expected to generate 1.31 times more return on investment than Korea Air. However, Tway Air is 1.31 times more volatile than Korea Air Svc. It trades about 0.04 of its potential returns per unit of risk. Korea Air Svc is currently generating about 0.04 per unit of risk. If you would invest 191,500 in Tway Air Co on August 23, 2024 and sell it today you would earn a total of 96,000 from holding Tway Air Co or generate 50.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tway Air Co vs. Korea Air Svc
Performance |
| Timeline |
| Tway Air |
| Korea Air Svc |
Tway Air and Korea Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tway Air and Korea Air
The main advantage of trading using opposite Tway Air and Korea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tway Air position performs unexpectedly, Korea Air 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 Korea Air will offset losses from the drop in Korea Air's long position.| Tway Air vs. Organic Special Pet | Tway Air vs. Hyundai Green Food | Tway Air vs. Samlip General Foods | Tway Air vs. Sam Yang Foods |
| Korea Air vs. Xavis Co | Korea Air vs. Hurum Co | Korea Air vs. Daishin Balance No8 | Korea Air vs. Korea Real Estate |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |