Correlation Between CJ Cheiljedang and Korea New
Can any of the company-specific risk be diversified away by investing in both CJ Cheiljedang and Korea New 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 CJ Cheiljedang and Korea New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CJ Cheiljedang and Korea New Network, you can compare the effects of market volatilities on CJ Cheiljedang and Korea New 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 CJ Cheiljedang with a short position of Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of CJ Cheiljedang and Korea New.
Diversification Opportunities for CJ Cheiljedang and Korea New
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 097950 and Korea is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding CJ Cheiljedang and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network and CJ Cheiljedang 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 CJ Cheiljedang are associated (or correlated) with Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of CJ Cheiljedang i.e., CJ Cheiljedang and Korea New go up and down completely randomly.
Pair Corralation between CJ Cheiljedang and Korea New
Assuming the 90 days trading horizon CJ Cheiljedang is expected to generate 2.32 times less return on investment than Korea New. But when comparing it to its historical volatility, CJ Cheiljedang is 1.05 times less risky than Korea New. It trades about 0.14 of its potential returns per unit of risk. Korea New Network is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 72,600 in Korea New Network on September 14, 2024 and sell it today you would earn a total of 16,500 from holding Korea New Network or generate 22.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CJ Cheiljedang vs. Korea New Network
Performance |
| Timeline |
| CJ Cheiljedang |
| Korea New Network |
CJ Cheiljedang and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CJ Cheiljedang and Korea New
The main advantage of trading using opposite CJ Cheiljedang and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CJ Cheiljedang position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.| CJ Cheiljedang vs. Korea New Network | CJ Cheiljedang vs. ICD Co | CJ Cheiljedang vs. DYPNF CoLtd | CJ Cheiljedang vs. Solution Advanced Technology |
| Korea New vs. Settlebank | Korea New vs. Dgb Financial | Korea New vs. BIT Computer Co | Korea New vs. CG Hi Tech |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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