Correlation Between YG Entertainment and Worldex Industry
Can any of the company-specific risk be diversified away by investing in both YG Entertainment and Worldex Industry 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 YG Entertainment and Worldex Industry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between YG Entertainment and Worldex Industry Trading, you can compare the effects of market volatilities on YG Entertainment and Worldex Industry 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 YG Entertainment with a short position of Worldex Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of YG Entertainment and Worldex Industry.
Diversification Opportunities for YG Entertainment and Worldex Industry
-0.86 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 122870 and Worldex is -0.86. Overlapping area represents the amount of risk that can be diversified away by holding YG Entertainment and Worldex Industry Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldex Industry Trading and YG Entertainment 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 YG Entertainment are associated (or correlated) with Worldex Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldex Industry Trading has no effect on the direction of YG Entertainment i.e., YG Entertainment and Worldex Industry go up and down completely randomly.
Pair Corralation between YG Entertainment and Worldex Industry
Assuming the 90 days trading horizon YG Entertainment is expected to generate 0.92 times more return on investment than Worldex Industry. However, YG Entertainment is 1.08 times less risky than Worldex Industry. It trades about 0.05 of its potential returns per unit of risk. Worldex Industry Trading is currently generating about -0.07 per unit of risk. If you would invest 4,030,000 in YG Entertainment on September 29, 2024 and sell it today you would earn a total of 485,000 from holding YG Entertainment or generate 12.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
YG Entertainment vs. Worldex Industry Trading
Performance |
| Timeline |
| YG Entertainment |
| Worldex Industry Trading |
YG Entertainment and Worldex Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with YG Entertainment and Worldex Industry
The main advantage of trading using opposite YG Entertainment and Worldex Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if YG Entertainment position performs unexpectedly, Worldex Industry 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 Worldex Industry will offset losses from the drop in Worldex Industry's long position.| YG Entertainment vs. Samsung Electronics Co | YG Entertainment vs. Samsung Electronics Co | YG Entertainment vs. KB Financial Group | YG Entertainment vs. Shinhan Financial Group |
| Worldex Industry vs. Dongsin Engineering Construction | Worldex Industry vs. Doosan Fuel Cell | Worldex Industry vs. Daishin Balance 1 | Worldex Industry vs. Total Soft Bank |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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