Correlation Between PJ Metal and Cuckoo Electronics
Can any of the company-specific risk be diversified away by investing in both PJ Metal and Cuckoo Electronics 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 Cuckoo Electronics 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 Cuckoo Electronics Co, you can compare the effects of market volatilities on PJ Metal and Cuckoo Electronics 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 Cuckoo Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PJ Metal and Cuckoo Electronics.
Diversification Opportunities for PJ Metal and Cuckoo Electronics
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 128660 and Cuckoo is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding PJ Metal Co and Cuckoo Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cuckoo Electronics 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 Cuckoo Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cuckoo Electronics has no effect on the direction of PJ Metal i.e., PJ Metal and Cuckoo Electronics go up and down completely randomly.
Pair Corralation between PJ Metal and Cuckoo Electronics
Assuming the 90 days trading horizon PJ Metal Co is expected to under-perform the Cuckoo Electronics. But the stock apears to be less risky and, when comparing its historical volatility, PJ Metal Co is 1.56 times less risky than Cuckoo Electronics. The stock trades about -0.23 of its potential returns per unit of risk. The Cuckoo Electronics Co is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2,235,000 in Cuckoo Electronics Co on November 7, 2024 and sell it today you would earn a total of 30,000 from holding Cuckoo Electronics Co or generate 1.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 89.47% |
| Values | Daily Returns |
PJ Metal Co vs. Cuckoo Electronics Co
Performance |
| Timeline |
| PJ Metal |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cuckoo Electronics |
PJ Metal and Cuckoo Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PJ Metal and Cuckoo Electronics
The main advantage of trading using opposite PJ Metal and Cuckoo Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PJ Metal position performs unexpectedly, Cuckoo Electronics 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 Cuckoo Electronics will offset losses from the drop in Cuckoo Electronics' long position.| PJ Metal vs. Dongnam Chemical Co | PJ Metal vs. Namhae Chemical | PJ Metal vs. Hansol Chemical Co | PJ Metal vs. Samsung Life Insurance |
| Cuckoo Electronics vs. Kaonmedia Co | Cuckoo Electronics vs. Hyundai Home Shopping | Cuckoo Electronics vs. AeroSpace Technology of | Cuckoo Electronics 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 Stocks Directory module to find actively traded stocks across global markets.
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