Correlation Between Koh Young and J Steel
Can any of the company-specific risk be diversified away by investing in both Koh Young and J Steel 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 Koh Young and J Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koh Young Technology and J Steel Co, you can compare the effects of market volatilities on Koh Young and J Steel 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 Koh Young with a short position of J Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koh Young and J Steel.
Diversification Opportunities for Koh Young and J Steel
Very good diversification
The 3 months correlation between Koh and 023440 is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Koh Young Technology and J Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Steel and Koh Young 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 Koh Young Technology are associated (or correlated) with J Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Steel has no effect on the direction of Koh Young i.e., Koh Young and J Steel go up and down completely randomly.
Pair Corralation between Koh Young and J Steel
Assuming the 90 days trading horizon Koh Young Technology is expected to generate 1.99 times more return on investment than J Steel. However, Koh Young is 1.99 times more volatile than J Steel Co. It trades about 0.3 of its potential returns per unit of risk. J Steel Co is currently generating about 0.09 per unit of risk. If you would invest 811,000 in Koh Young Technology on November 30, 2024 and sell it today you would earn a total of 841,000 from holding Koh Young Technology or generate 103.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koh Young Technology vs. J Steel Co
Performance |
| Timeline |
| Koh Young Technology |
| J Steel |
Koh Young and J Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koh Young and J Steel
The main advantage of trading using opposite Koh Young and J Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koh Young position performs unexpectedly, J Steel 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 J Steel will offset losses from the drop in J Steel's long position.| Koh Young vs. Samsung Electronics Co | Koh Young vs. Samsung Electronics Co | Koh Young vs. SK Hynix | Koh Young vs. HMM Co |
| J Steel vs. PlayD Co | J Steel vs. SBI Investment KOREA | J Steel vs. Daol Investment Securities | J Steel vs. PLAYWITH |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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