Correlation Between Puloon Technology and GS Engineering
Can any of the company-specific risk be diversified away by investing in both Puloon Technology and GS Engineering 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 Puloon Technology and GS Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puloon Technology and GS Engineering Construction, you can compare the effects of market volatilities on Puloon Technology and GS Engineering 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 Puloon Technology with a short position of GS Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puloon Technology and GS Engineering.
Diversification Opportunities for Puloon Technology and GS Engineering
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Puloon and 006360 is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Puloon Technology and GS Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GS Engineering Const and Puloon Technology 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 Puloon Technology are associated (or correlated) with GS Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GS Engineering Const has no effect on the direction of Puloon Technology i.e., Puloon Technology and GS Engineering go up and down completely randomly.
Pair Corralation between Puloon Technology and GS Engineering
Assuming the 90 days trading horizon Puloon Technology is expected to generate 0.97 times more return on investment than GS Engineering. However, Puloon Technology is 1.03 times less risky than GS Engineering. It trades about 0.31 of its potential returns per unit of risk. GS Engineering Construction is currently generating about 0.05 per unit of risk. If you would invest 672,000 in Puloon Technology on October 28, 2024 and sell it today you would earn a total of 82,000 from holding Puloon Technology or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Puloon Technology vs. GS Engineering Construction
Performance |
| Timeline |
| Puloon Technology |
| GS Engineering Const |
Puloon Technology and GS Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puloon Technology and GS Engineering
The main advantage of trading using opposite Puloon Technology and GS Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puloon Technology position performs unexpectedly, GS Engineering 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 GS Engineering will offset losses from the drop in GS Engineering's long position.| Puloon Technology vs. ECSTELECOM Co | Puloon Technology vs. Korean Air Lines | Puloon Technology vs. KTB Investment Securities | Puloon Technology vs. Shinhan Inverse Silver |
| GS Engineering vs. Neungyule Education | GS Engineering vs. Kyung In Synthetic Corp | GS Engineering vs. CKH Food Health | GS Engineering vs. Youl Chon Chemical |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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