Correlation Between Grand Korea and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both Grand Korea and Kukil Metal 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 Grand Korea and Kukil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Korea Leisure and Kukil Metal Co, you can compare the effects of market volatilities on Grand Korea and Kukil Metal 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 Grand Korea with a short position of Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Korea and Kukil Metal.
Diversification Opportunities for Grand Korea and Kukil Metal
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Grand and Kukil is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Grand Korea Leisure and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal and Grand Korea 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 Grand Korea Leisure are associated (or correlated) with Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of Grand Korea i.e., Grand Korea and Kukil Metal go up and down completely randomly.
Pair Corralation between Grand Korea and Kukil Metal
Assuming the 90 days trading horizon Grand Korea Leisure is expected to generate 1.22 times more return on investment than Kukil Metal. However, Grand Korea is 1.22 times more volatile than Kukil Metal Co. It trades about 0.06 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.31 per unit of risk. If you would invest 1,146,000 in Grand Korea Leisure on September 1, 2024 and sell it today you would earn a total of 26,000 from holding Grand Korea Leisure or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Korea Leisure vs. Kukil Metal Co
Performance |
| Timeline |
| Grand Korea Leisure |
| Kukil Metal |
Grand Korea and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Korea and Kukil Metal
The main advantage of trading using opposite Grand Korea and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Korea position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| Grand Korea vs. Cots Technology Co | Grand Korea vs. RFTech Co | Grand Korea vs. Shinhan Inverse Silver | Grand Korea vs. Vitzro Tech Co |
| Kukil Metal vs. Keum Kang Steel | Kukil Metal vs. Tplex Co | Kukil Metal vs. Gyeongnam Steel Co | Kukil Metal vs. Jeil Steel Mfg |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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