Correlation Between PJ Metal and Korea Investment
Can any of the company-specific risk be diversified away by investing in both PJ Metal and Korea Investment 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 PJ Metal and Korea Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PJ Metal Co and Korea Investment Holdings, you can compare the effects of market volatilities on PJ Metal and Korea Investment 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 PJ Metal with a short position of Korea Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Metal and Korea Investment.
Diversification Opportunities for PJ Metal and Korea Investment
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between 128660 and Korea is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding PJ Metal Co and Korea Investment Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Investment Holdings and PJ Metal 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 PJ Metal Co are associated (or correlated) with Korea Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Investment Holdings has no effect on the direction of PJ Metal i.e., PJ Metal and Korea Investment go up and down completely randomly.
Pair Corralation between PJ Metal and Korea Investment
Assuming the 90 days trading horizon PJ Metal is expected to generate 4.69 times less return on investment than Korea Investment. In addition to that, PJ Metal is 2.25 times more volatile than Korea Investment Holdings. It trades about 0.0 of its total potential returns per unit of risk. Korea Investment Holdings is currently generating about 0.03 per unit of volatility. If you would invest 4,556,455 in Korea Investment Holdings on September 1, 2024 and sell it today you would earn a total of 853,545 from holding Korea Investment Holdings or generate 18.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PJ Metal Co vs. Korea Investment Holdings
Performance |
| Timeline |
| PJ Metal |
| Korea Investment Holdings |
PJ Metal and Korea Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Metal and Korea Investment
The main advantage of trading using opposite PJ Metal and Korea Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Metal position performs unexpectedly, Korea Investment 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 Korea Investment will offset losses from the drop in Korea Investment's long position.| PJ Metal vs. Shinsung Delta Tech | PJ Metal vs. JYP Entertainment Corp | PJ Metal vs. Cube Entertainment | PJ Metal vs. Amogreentech Co |
| Korea Investment vs. GS Retail Co | Korea Investment vs. Handok Clean Tech | Korea Investment vs. Samsung Life Insurance | Korea Investment vs. Clean Science 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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