Correlation Between ABOV Semiconductor and Tae Kyung
Can any of the company-specific risk be diversified away by investing in both ABOV Semiconductor and Tae Kyung 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 ABOV Semiconductor and Tae Kyung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABOV Semiconductor Co and Tae Kyung Chemical, you can compare the effects of market volatilities on ABOV Semiconductor and Tae Kyung 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 ABOV Semiconductor with a short position of Tae Kyung. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABOV Semiconductor and Tae Kyung.
Diversification Opportunities for ABOV Semiconductor and Tae Kyung
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ABOV and Tae is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding ABOV Semiconductor Co and Tae Kyung Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tae Kyung Chemical and ABOV Semiconductor 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 ABOV Semiconductor Co are associated (or correlated) with Tae Kyung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tae Kyung Chemical has no effect on the direction of ABOV Semiconductor i.e., ABOV Semiconductor and Tae Kyung go up and down completely randomly.
Pair Corralation between ABOV Semiconductor and Tae Kyung
Assuming the 90 days trading horizon ABOV Semiconductor Co is expected to under-perform the Tae Kyung. In addition to that, ABOV Semiconductor is 1.93 times more volatile than Tae Kyung Chemical. It trades about -0.34 of its total potential returns per unit of risk. Tae Kyung Chemical is currently generating about -0.01 per unit of volatility. If you would invest 1,095,000 in Tae Kyung Chemical on August 27, 2024 and sell it today you would lose (6,000) from holding Tae Kyung Chemical or give up 0.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABOV Semiconductor Co vs. Tae Kyung Chemical
Performance |
| Timeline |
| ABOV Semiconductor |
| Tae Kyung Chemical |
ABOV Semiconductor and Tae Kyung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABOV Semiconductor and Tae Kyung
The main advantage of trading using opposite ABOV Semiconductor and Tae Kyung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABOV Semiconductor position performs unexpectedly, Tae Kyung 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 Tae Kyung will offset losses from the drop in Tae Kyung's long position.| ABOV Semiconductor vs. Korea Real Estate | ABOV Semiconductor vs. Korea Ratings Co | ABOV Semiconductor vs. IQuest Co | ABOV Semiconductor vs. Wonbang Tech Co |
| Tae Kyung vs. AptaBio Therapeutics | Tae Kyung vs. Daewoo SBI SPAC | Tae Kyung vs. Dream Security co | Tae Kyung vs. Microfriend |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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