Correlation Between Alton Sports and Lotte Non
Can any of the company-specific risk be diversified away by investing in both Alton Sports and Lotte Non 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 Alton Sports and Lotte Non into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alton Sports CoLtd and Lotte Non Life Insurance, you can compare the effects of market volatilities on Alton Sports and Lotte Non 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 Alton Sports with a short position of Lotte Non. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alton Sports and Lotte Non.
Diversification Opportunities for Alton Sports and Lotte Non
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Alton and Lotte is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Alton Sports CoLtd and Lotte Non Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Non Life and Alton Sports 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 Alton Sports CoLtd are associated (or correlated) with Lotte Non. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Non Life has no effect on the direction of Alton Sports i.e., Alton Sports and Lotte Non go up and down completely randomly.
Pair Corralation between Alton Sports and Lotte Non
Assuming the 90 days trading horizon Alton Sports CoLtd is expected to generate 0.79 times more return on investment than Lotte Non. However, Alton Sports CoLtd is 1.26 times less risky than Lotte Non. It trades about 0.33 of its potential returns per unit of risk. Lotte Non Life Insurance is currently generating about -0.2 per unit of risk. If you would invest 145,300 in Alton Sports CoLtd on November 7, 2024 and sell it today you would earn a total of 8,700 from holding Alton Sports CoLtd or generate 5.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alton Sports CoLtd vs. Lotte Non Life Insurance
Performance |
| Timeline |
| Alton Sports CoLtd |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Lotte Non Life |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Alton Sports and Lotte Non Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alton Sports and Lotte Non
The main advantage of trading using opposite Alton Sports and Lotte Non positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alton Sports position performs unexpectedly, Lotte Non 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 Lotte Non will offset losses from the drop in Lotte Non's long position.| Alton Sports vs. Korea Plasma Technology | Alton Sports vs. Daou Technology | Alton Sports vs. Vina Technology Co | Alton Sports vs. Woori Technology |
| Lotte Non vs. Dongbang Transport Logistics | Lotte Non vs. PH Tech Co | Lotte Non vs. SK Chemicals Co | Lotte Non vs. Polaris Office Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |