Correlation Between N Citron and Cosmax Nbt
Can any of the company-specific risk be diversified away by investing in both N Citron and Cosmax Nbt 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 N Citron and Cosmax Nbt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between N Citron and Cosmax Nbt, you can compare the effects of market volatilities on N Citron and Cosmax Nbt 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 N Citron with a short position of Cosmax Nbt. Check out your portfolio center. Please also check ongoing floating volatility patterns of N Citron and Cosmax Nbt.
Diversification Opportunities for N Citron and Cosmax Nbt
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 101400 and Cosmax is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding N Citron and Cosmax Nbt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmax Nbt and N Citron 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 N Citron are associated (or correlated) with Cosmax Nbt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmax Nbt has no effect on the direction of N Citron i.e., N Citron and Cosmax Nbt go up and down completely randomly.
Pair Corralation between N Citron and Cosmax Nbt
Assuming the 90 days trading horizon N Citron is expected to under-perform the Cosmax Nbt. But the stock apears to be less risky and, when comparing its historical volatility, N Citron is 1.5 times less risky than Cosmax Nbt. The stock trades about -0.08 of its potential returns per unit of risk. The Cosmax Nbt is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 392,500 in Cosmax Nbt on September 1, 2024 and sell it today you would lose (65,000) from holding Cosmax Nbt or give up 16.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
N Citron vs. Cosmax Nbt
Performance |
| Timeline |
| N Citron |
| Cosmax Nbt |
N Citron and Cosmax Nbt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with N Citron and Cosmax Nbt
The main advantage of trading using opposite N Citron and Cosmax Nbt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if N Citron position performs unexpectedly, Cosmax Nbt 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 Cosmax Nbt will offset losses from the drop in Cosmax Nbt's long position.| N Citron vs. Tuksu Engineering ConstructionLtd | N Citron vs. Dongwoo Farm To | N Citron vs. Korea Shipbuilding Offshore | N Citron vs. Seohee Construction Co |
| Cosmax Nbt vs. Jeju Semiconductor Corp | Cosmax Nbt vs. Hanwha InvestmentSecurities Co | Cosmax Nbt vs. Woori Technology Investment | Cosmax Nbt vs. DB Financial Investment |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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