Correlation Between Tamul Multimedia and ECSTELECOM
Can any of the company-specific risk be diversified away by investing in both Tamul Multimedia and ECSTELECOM 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 Tamul Multimedia and ECSTELECOM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tamul Multimedia Co and ECSTELECOM Co, you can compare the effects of market volatilities on Tamul Multimedia and ECSTELECOM 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 Tamul Multimedia with a short position of ECSTELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tamul Multimedia and ECSTELECOM.
Diversification Opportunities for Tamul Multimedia and ECSTELECOM
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tamul and ECSTELECOM is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Tamul Multimedia Co and ECSTELECOM Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECSTELECOM and Tamul Multimedia 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 Tamul Multimedia Co are associated (or correlated) with ECSTELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECSTELECOM has no effect on the direction of Tamul Multimedia i.e., Tamul Multimedia and ECSTELECOM go up and down completely randomly.
Pair Corralation between Tamul Multimedia and ECSTELECOM
Assuming the 90 days trading horizon Tamul Multimedia Co is expected to generate 2.01 times more return on investment than ECSTELECOM. However, Tamul Multimedia is 2.01 times more volatile than ECSTELECOM Co. It trades about 0.05 of its potential returns per unit of risk. ECSTELECOM Co is currently generating about -0.16 per unit of risk. If you would invest 421,000 in Tamul Multimedia Co on August 31, 2024 and sell it today you would earn a total of 8,000 from holding Tamul Multimedia Co or generate 1.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tamul Multimedia Co vs. ECSTELECOM Co
Performance |
| Timeline |
| Tamul Multimedia |
| ECSTELECOM |
Tamul Multimedia and ECSTELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tamul Multimedia and ECSTELECOM
The main advantage of trading using opposite Tamul Multimedia and ECSTELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tamul Multimedia position performs unexpectedly, ECSTELECOM 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 ECSTELECOM will offset losses from the drop in ECSTELECOM's long position.| Tamul Multimedia vs. Solution Advanced Technology | Tamul Multimedia vs. Shinsegae Food | Tamul Multimedia vs. Samyang Foods Co | Tamul Multimedia vs. Organic Special Pet |
| ECSTELECOM vs. Busan Industrial Co | ECSTELECOM vs. Busan Ind | ECSTELECOM vs. Mirae Asset Daewoo | ECSTELECOM vs. Finebesteel |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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