Correlation Between Tway Air and Kukdo Chemical
Can any of the company-specific risk be diversified away by investing in both Tway Air and Kukdo Chemical 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 Kukdo Chemical 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 Kukdo Chemical Co, you can compare the effects of market volatilities on Tway Air and Kukdo Chemical 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 Kukdo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tway Air and Kukdo Chemical.
Diversification Opportunities for Tway Air and Kukdo Chemical
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Tway and Kukdo is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Tway Air Co and Kukdo Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukdo Chemical 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 Kukdo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukdo Chemical has no effect on the direction of Tway Air i.e., Tway Air and Kukdo Chemical go up and down completely randomly.
Pair Corralation between Tway Air and Kukdo Chemical
Assuming the 90 days trading horizon Tway Air Co is expected to generate 1.45 times more return on investment than Kukdo Chemical. However, Tway Air is 1.45 times more volatile than Kukdo Chemical Co. It trades about 0.0 of its potential returns per unit of risk. Kukdo Chemical Co is currently generating about -0.03 per unit of risk. If you would invest 339,500 in Tway Air Co on September 19, 2024 and sell it today you would lose (78,500) from holding Tway Air Co or give up 23.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tway Air Co vs. Kukdo Chemical Co
Performance |
| Timeline |
| Tway Air |
| Kukdo Chemical |
Tway Air and Kukdo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tway Air and Kukdo Chemical
The main advantage of trading using opposite Tway Air and Kukdo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tway Air position performs unexpectedly, Kukdo Chemical 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 Kukdo Chemical will offset losses from the drop in Kukdo Chemical's long position.| Tway Air vs. Jin Air Co | Tway Air vs. Air Busan Co | Tway Air vs. Solution Advanced Technology | Tway Air vs. Busan Industrial Co |
| Kukdo Chemical vs. Samsung Electronics Co | Kukdo Chemical vs. Samsung Electronics Co | Kukdo Chemical vs. SK Hynix | Kukdo Chemical vs. POSCO Holdings |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |