Correlation Between Finebesteel and Taegu Broadcasting
Can any of the company-specific risk be diversified away by investing in both Finebesteel and Taegu Broadcasting 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 Finebesteel and Taegu Broadcasting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finebesteel and Taegu Broadcasting, you can compare the effects of market volatilities on Finebesteel and Taegu Broadcasting 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 Finebesteel with a short position of Taegu Broadcasting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finebesteel and Taegu Broadcasting.
Diversification Opportunities for Finebesteel and Taegu Broadcasting
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Finebesteel and Taegu is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Finebesteel and Taegu Broadcasting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taegu Broadcasting and Finebesteel 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 Finebesteel are associated (or correlated) with Taegu Broadcasting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taegu Broadcasting has no effect on the direction of Finebesteel i.e., Finebesteel and Taegu Broadcasting go up and down completely randomly.
Pair Corralation between Finebesteel and Taegu Broadcasting
Assuming the 90 days trading horizon Finebesteel is expected to generate 1.17 times more return on investment than Taegu Broadcasting. However, Finebesteel is 1.17 times more volatile than Taegu Broadcasting. It trades about 0.27 of its potential returns per unit of risk. Taegu Broadcasting is currently generating about -0.14 per unit of risk. If you would invest 92,100 in Finebesteel on November 7, 2024 and sell it today you would earn a total of 14,800 from holding Finebesteel or generate 16.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Finebesteel vs. Taegu Broadcasting
Performance |
| Timeline |
| Finebesteel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Taegu Broadcasting |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Finebesteel and Taegu Broadcasting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finebesteel and Taegu Broadcasting
The main advantage of trading using opposite Finebesteel and Taegu Broadcasting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finebesteel position performs unexpectedly, Taegu Broadcasting 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 Taegu Broadcasting will offset losses from the drop in Taegu Broadcasting's long position.| Finebesteel vs. Eagle Veterinary Technology | Finebesteel vs. V One Tech Co | Finebesteel vs. Hanwha Chemical Corp | Finebesteel vs. Raontech |
| Taegu Broadcasting vs. Playgram Co | Taegu Broadcasting vs. INNOX Advanced Materials | Taegu Broadcasting vs. Vitzro Tech Co | Taegu Broadcasting vs. Korea Information Communications |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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