Correlation Between ChipsMedia and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both ChipsMedia and Kukil Metal 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 ChipsMedia and Kukil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ChipsMedia and Kukil Metal Co, you can compare the effects of market volatilities on ChipsMedia and Kukil Metal 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 ChipsMedia with a short position of Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChipsMedia and Kukil Metal.
Diversification Opportunities for ChipsMedia and Kukil Metal
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ChipsMedia and Kukil is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding ChipsMedia and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal and ChipsMedia 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 ChipsMedia are associated (or correlated) with Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of ChipsMedia i.e., ChipsMedia and Kukil Metal go up and down completely randomly.
Pair Corralation between ChipsMedia and Kukil Metal
Assuming the 90 days trading horizon ChipsMedia is expected to generate 2.11 times more return on investment than Kukil Metal. However, ChipsMedia is 2.11 times more volatile than Kukil Metal Co. It trades about 0.02 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.33 per unit of risk. If you would invest 1,354,000 in ChipsMedia on September 2, 2024 and sell it today you would earn a total of 3,000 from holding ChipsMedia or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChipsMedia vs. Kukil Metal Co
Performance |
| Timeline |
| ChipsMedia |
| Kukil Metal |
ChipsMedia and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChipsMedia and Kukil Metal
The main advantage of trading using opposite ChipsMedia and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChipsMedia position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| ChipsMedia vs. Duksan Hi Metal | ChipsMedia vs. Korea Investment Holdings | ChipsMedia vs. Kbi Metal Co | ChipsMedia vs. Daelim Trading Co |
| Kukil Metal vs. Keum Kang Steel | Kukil Metal vs. Tplex Co | Kukil Metal vs. Jeil Steel Mfg | Kukil Metal vs. Wonil Special Steel |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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