Correlation Between Youngchang Chemical and Tamul Multimedia
Can any of the company-specific risk be diversified away by investing in both Youngchang Chemical and Tamul Multimedia 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 Youngchang Chemical and Tamul Multimedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngchang Chemical Co and Tamul Multimedia Co, you can compare the effects of market volatilities on Youngchang Chemical and Tamul Multimedia 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 Youngchang Chemical with a short position of Tamul Multimedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngchang Chemical and Tamul Multimedia.
Diversification Opportunities for Youngchang Chemical and Tamul Multimedia
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Youngchang and Tamul is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Youngchang Chemical Co and Tamul Multimedia Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tamul Multimedia and Youngchang Chemical 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 Youngchang Chemical Co are associated (or correlated) with Tamul Multimedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tamul Multimedia has no effect on the direction of Youngchang Chemical i.e., Youngchang Chemical and Tamul Multimedia go up and down completely randomly.
Pair Corralation between Youngchang Chemical and Tamul Multimedia
Assuming the 90 days trading horizon Youngchang Chemical Co is expected to generate 1.53 times more return on investment than Tamul Multimedia. However, Youngchang Chemical is 1.53 times more volatile than Tamul Multimedia Co. It trades about 0.39 of its potential returns per unit of risk. Tamul Multimedia Co is currently generating about -0.4 per unit of risk. If you would invest 1,446,000 in Youngchang Chemical Co on November 5, 2024 and sell it today you would earn a total of 669,000 from holding Youngchang Chemical Co or generate 46.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngchang Chemical Co vs. Tamul Multimedia Co
Performance |
| Timeline |
| Youngchang Chemical |
| Tamul Multimedia |
Youngchang Chemical and Tamul Multimedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngchang Chemical and Tamul Multimedia
The main advantage of trading using opposite Youngchang Chemical and Tamul Multimedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngchang Chemical position performs unexpectedly, Tamul Multimedia 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 Tamul Multimedia will offset losses from the drop in Tamul Multimedia's long position.| Youngchang Chemical vs. LG Chem | Youngchang Chemical vs. Chunbo Co | Youngchang Chemical vs. DukSan Neolux CoLtd | Youngchang Chemical vs. Hyosung Chemical Corp |
| Tamul Multimedia vs. SK Hynix | Tamul Multimedia vs. LX Semicon Co | Tamul Multimedia vs. Tokai Carbon Korea | Tamul Multimedia vs. People Technology |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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