Correlation Between Miwon Chemical and Koryo Credit
Can any of the company-specific risk be diversified away by investing in both Miwon Chemical and Koryo Credit 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 Miwon Chemical and Koryo Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miwon Chemical and Koryo Credit Information, you can compare the effects of market volatilities on Miwon Chemical and Koryo Credit 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 Miwon Chemical with a short position of Koryo Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miwon Chemical and Koryo Credit.
Diversification Opportunities for Miwon Chemical and Koryo Credit
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Miwon and Koryo is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Miwon Chemical and Koryo Credit Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koryo Credit Information and Miwon Chemical 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 Miwon Chemical are associated (or correlated) with Koryo Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koryo Credit Information has no effect on the direction of Miwon Chemical i.e., Miwon Chemical and Koryo Credit go up and down completely randomly.
Pair Corralation between Miwon Chemical and Koryo Credit
Assuming the 90 days trading horizon Miwon Chemical is expected to under-perform the Koryo Credit. But the stock apears to be less risky and, when comparing its historical volatility, Miwon Chemical is 1.67 times less risky than Koryo Credit. The stock trades about -0.23 of its potential returns per unit of risk. The Koryo Credit Information is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 996,000 in Koryo Credit Information on August 25, 2024 and sell it today you would lose (3,000) from holding Koryo Credit Information or give up 0.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miwon Chemical vs. Koryo Credit Information
Performance |
| Timeline |
| Miwon Chemical |
| Koryo Credit Information |
Miwon Chemical and Koryo Credit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miwon Chemical and Koryo Credit
The main advantage of trading using opposite Miwon Chemical and Koryo Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miwon Chemical position performs unexpectedly, Koryo Credit 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 Koryo Credit will offset losses from the drop in Koryo Credit's long position.| Miwon Chemical vs. LG Chem | Miwon Chemical vs. Chunbo Co | Miwon Chemical vs. Hyosung Chemical Corp | Miwon Chemical vs. LIG ES SPAC |
| Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Hyundai Motor Co | Koryo Credit vs. Hyundai Motor |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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