Correlation Between EV Advanced and Iljin Display
Can any of the company-specific risk be diversified away by investing in both EV Advanced and Iljin Display 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 EV Advanced and Iljin Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EV Advanced Material and Iljin Display, you can compare the effects of market volatilities on EV Advanced and Iljin Display 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 EV Advanced with a short position of Iljin Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of EV Advanced and Iljin Display.
Diversification Opportunities for EV Advanced and Iljin Display
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 131400 and Iljin is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding EV Advanced Material and Iljin Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iljin Display and EV Advanced 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 EV Advanced Material are associated (or correlated) with Iljin Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iljin Display has no effect on the direction of EV Advanced i.e., EV Advanced and Iljin Display go up and down completely randomly.
Pair Corralation between EV Advanced and Iljin Display
Assuming the 90 days trading horizon EV Advanced Material is expected to under-perform the Iljin Display. But the stock apears to be less risky and, when comparing its historical volatility, EV Advanced Material is 1.29 times less risky than Iljin Display. The stock trades about -0.25 of its potential returns per unit of risk. The Iljin Display is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 86,500 in Iljin Display on November 5, 2024 and sell it today you would earn a total of 1,800 from holding Iljin Display or generate 2.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EV Advanced Material vs. Iljin Display
Performance |
| Timeline |
| EV Advanced Material |
| Iljin Display |
EV Advanced and Iljin Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EV Advanced and Iljin Display
The main advantage of trading using opposite EV Advanced and Iljin Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EV Advanced position performs unexpectedly, Iljin Display 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 Iljin Display will offset losses from the drop in Iljin Display's long position.| EV Advanced vs. Namhae Chemical | EV Advanced vs. Hanshin Construction Co | EV Advanced vs. Youngbo Chemical Co | EV Advanced vs. Youngchang Chemical Co |
| Iljin Display vs. Daechang Steel Co | Iljin Display vs. Hankuk Steel Wire | Iljin Display vs. Seah Steel Corp | Iljin Display vs. Haitai Confectionery Foods |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |