Correlation Between EV Advanced and ENERGYMACHINERY KOREA
Can any of the company-specific risk be diversified away by investing in both EV Advanced and ENERGYMACHINERY KOREA 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 ENERGYMACHINERY KOREA 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 ENERGYMACHINERY KOREA CoLtd, you can compare the effects of market volatilities on EV Advanced and ENERGYMACHINERY KOREA 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 ENERGYMACHINERY KOREA. Check out your portfolio center. Please also check ongoing floating volatility patterns of EV Advanced and ENERGYMACHINERY KOREA.
Diversification Opportunities for EV Advanced and ENERGYMACHINERY KOREA
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 131400 and ENERGYMACHINERY is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding EV Advanced Material and ENERGYMACHINERY KOREA CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ENERGYMACHINERY KOREA 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 ENERGYMACHINERY KOREA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ENERGYMACHINERY KOREA has no effect on the direction of EV Advanced i.e., EV Advanced and ENERGYMACHINERY KOREA go up and down completely randomly.
Pair Corralation between EV Advanced and ENERGYMACHINERY KOREA
Assuming the 90 days trading horizon EV Advanced is expected to generate 2.8 times less return on investment than ENERGYMACHINERY KOREA. In addition to that, EV Advanced is 1.08 times more volatile than ENERGYMACHINERY KOREA CoLtd. It trades about 0.03 of its total potential returns per unit of risk. ENERGYMACHINERY KOREA CoLtd is currently generating about 0.08 per unit of volatility. If you would invest 229,500 in ENERGYMACHINERY KOREA CoLtd on October 24, 2024 and sell it today you would earn a total of 5,500 from holding ENERGYMACHINERY KOREA CoLtd or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EV Advanced Material vs. ENERGYMACHINERY KOREA CoLtd
Performance |
| Timeline |
| EV Advanced Material |
| ENERGYMACHINERY KOREA |
EV Advanced and ENERGYMACHINERY KOREA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EV Advanced and ENERGYMACHINERY KOREA
The main advantage of trading using opposite EV Advanced and ENERGYMACHINERY KOREA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EV Advanced position performs unexpectedly, ENERGYMACHINERY KOREA 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 ENERGYMACHINERY KOREA will offset losses from the drop in ENERGYMACHINERY KOREA's long position.| EV Advanced vs. Daewoo Electronic Components | EV Advanced vs. DAEDUCK ELECTRONICS CoLtd | EV Advanced vs. Seoul Electronics Telecom | EV Advanced vs. Sung Bo Chemicals |
| ENERGYMACHINERY KOREA vs. Hyundai Engineering Plastics | ENERGYMACHINERY KOREA vs. Ecoplastic | ENERGYMACHINERY KOREA vs. EV Advanced Material | ENERGYMACHINERY KOREA vs. Alton Sports CoLtd |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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