Correlation Between Finebesteel and Tamul Multimedia
Can any of the company-specific risk be diversified away by investing in both Finebesteel and Tamul Multimedia 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 Tamul Multimedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finebesteel and Tamul Multimedia Co, you can compare the effects of market volatilities on Finebesteel and Tamul Multimedia 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 Tamul Multimedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finebesteel and Tamul Multimedia.
Diversification Opportunities for Finebesteel and Tamul Multimedia
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Finebesteel and Tamul is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Finebesteel and Tamul Multimedia Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tamul Multimedia 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 Tamul Multimedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tamul Multimedia has no effect on the direction of Finebesteel i.e., Finebesteel and Tamul Multimedia go up and down completely randomly.
Pair Corralation between Finebesteel and Tamul Multimedia
Assuming the 90 days trading horizon Finebesteel is expected to generate 0.97 times more return on investment than Tamul Multimedia. However, Finebesteel is 1.03 times less risky than Tamul Multimedia. It trades about -0.03 of its potential returns per unit of risk. Tamul Multimedia Co is currently generating about -0.05 per unit of risk. If you would invest 214,000 in Finebesteel on October 27, 2024 and sell it today you would lose (104,600) from holding Finebesteel or give up 48.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Finebesteel vs. Tamul Multimedia Co
Performance |
| Timeline |
| Finebesteel |
| Tamul Multimedia |
Finebesteel and Tamul Multimedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finebesteel and Tamul Multimedia
The main advantage of trading using opposite Finebesteel and Tamul Multimedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finebesteel position performs unexpectedly, Tamul Multimedia 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 Tamul Multimedia will offset losses from the drop in Tamul Multimedia's long position.| Finebesteel vs. Dongkuk Structures Construction | Finebesteel vs. GS Engineering Construction | Finebesteel vs. Hyundai Home Shopping | Finebesteel vs. Korea Information Communications |
| Tamul Multimedia vs. Daejoo Electronic Materials | Tamul Multimedia vs. Cuckoo Electronics Co | Tamul Multimedia vs. Daechang Steel Co | Tamul Multimedia vs. Hironic 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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