Correlation Between ABOV Semiconductor and CJ Seafood
Can any of the company-specific risk be diversified away by investing in both ABOV Semiconductor and CJ Seafood 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 CJ Seafood 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 CJ Seafood Corp, you can compare the effects of market volatilities on ABOV Semiconductor and CJ Seafood 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 CJ Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABOV Semiconductor and CJ Seafood.
Diversification Opportunities for ABOV Semiconductor and CJ Seafood
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ABOV and 011155 is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding ABOV Semiconductor Co and CJ Seafood Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ Seafood Corp 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 CJ Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ Seafood Corp has no effect on the direction of ABOV Semiconductor i.e., ABOV Semiconductor and CJ Seafood go up and down completely randomly.
Pair Corralation between ABOV Semiconductor and CJ Seafood
Assuming the 90 days trading horizon ABOV Semiconductor Co is expected to generate 6.2 times more return on investment than CJ Seafood. However, ABOV Semiconductor is 6.2 times more volatile than CJ Seafood Corp. It trades about 0.33 of its potential returns per unit of risk. CJ Seafood Corp is currently generating about -0.05 per unit of risk. If you would invest 834,000 in ABOV Semiconductor Co on November 27, 2024 and sell it today you would earn a total of 441,000 from holding ABOV Semiconductor Co or generate 52.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABOV Semiconductor Co vs. CJ Seafood Corp
Performance |
| Timeline |
| ABOV Semiconductor |
| CJ Seafood Corp |
ABOV Semiconductor and CJ Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABOV Semiconductor and CJ Seafood
The main advantage of trading using opposite ABOV Semiconductor and CJ Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABOV Semiconductor position performs unexpectedly, CJ Seafood 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 CJ Seafood will offset losses from the drop in CJ Seafood's long position.| ABOV Semiconductor vs. Hyundai Engineering Construction | ABOV Semiconductor vs. ENERGYMACHINERY KOREA CoLtd | ABOV Semiconductor vs. Seoul Semiconductor Co | ABOV Semiconductor vs. Keyang Electric Machinery |
| CJ Seafood vs. Lotte Non Life Insurance | CJ Seafood vs. UJU Electronics Co | CJ Seafood vs. Samwha Electronics Co | CJ Seafood vs. Shinil Electronics Co |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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