Correlation Between Tway Air and Jeju Beer
Can any of the company-specific risk be diversified away by investing in both Tway Air and Jeju Beer 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 Jeju Beer 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 Jeju Beer Co, you can compare the effects of market volatilities on Tway Air and Jeju Beer 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 Jeju Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tway Air and Jeju Beer.
Diversification Opportunities for Tway Air and Jeju Beer
Very good diversification
The 3 months correlation between Tway and Jeju is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Tway Air Co and Jeju Beer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeju Beer 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 Jeju Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeju Beer has no effect on the direction of Tway Air i.e., Tway Air and Jeju Beer go up and down completely randomly.
Pair Corralation between Tway Air and Jeju Beer
Assuming the 90 days trading horizon Tway Air is expected to generate 14.28 times less return on investment than Jeju Beer. In addition to that, Tway Air is 1.1 times more volatile than Jeju Beer Co. It trades about 0.01 of its total potential returns per unit of risk. Jeju Beer Co is currently generating about 0.11 per unit of volatility. If you would invest 277,000 in Jeju Beer Co on September 3, 2024 and sell it today you would earn a total of 48,000 from holding Jeju Beer Co or generate 17.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tway Air Co vs. Jeju Beer Co
Performance |
| Timeline |
| Tway Air |
| Jeju Beer |
Tway Air and Jeju Beer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tway Air and Jeju Beer
The main advantage of trading using opposite Tway Air and Jeju Beer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tway Air position performs unexpectedly, Jeju Beer 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 Jeju Beer will offset losses from the drop in Jeju Beer's long position.| Tway Air vs. Jin Air Co | Tway Air vs. Air Busan Co | Tway Air vs. Busan Industrial Co | Tway Air vs. UNISEM Co |
| Jeju Beer vs. AptaBio Therapeutics | Jeju Beer vs. Daewoo SBI SPAC | Jeju Beer vs. Dream Security co | Jeju Beer vs. Microfriend |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Global Correlations Find global opportunities by holding instruments from different markets |