Correlation Between Miwon Chemical and COWINTECH
Can any of the company-specific risk be diversified away by investing in both Miwon Chemical and COWINTECH 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 COWINTECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miwon Chemical and COWINTECH Co, you can compare the effects of market volatilities on Miwon Chemical and COWINTECH 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 COWINTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miwon Chemical and COWINTECH.
Diversification Opportunities for Miwon Chemical and COWINTECH
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Miwon and COWINTECH is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Miwon Chemical and COWINTECH Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COWINTECH 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 COWINTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COWINTECH has no effect on the direction of Miwon Chemical i.e., Miwon Chemical and COWINTECH go up and down completely randomly.
Pair Corralation between Miwon Chemical and COWINTECH
Assuming the 90 days trading horizon Miwon Chemical is expected to generate 0.26 times more return on investment than COWINTECH. However, Miwon Chemical is 3.82 times less risky than COWINTECH. It trades about 0.09 of its potential returns per unit of risk. COWINTECH Co is currently generating about -0.14 per unit of risk. If you would invest 7,850,000 in Miwon Chemical on January 23, 2025 and sell it today you would earn a total of 130,000 from holding Miwon Chemical or generate 1.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miwon Chemical vs. COWINTECH Co
Performance |
| Timeline |
| Miwon Chemical |
| COWINTECH |
Miwon Chemical and COWINTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miwon Chemical and COWINTECH
The main advantage of trading using opposite Miwon Chemical and COWINTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miwon Chemical position performs unexpectedly, COWINTECH 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 COWINTECH will offset losses from the drop in COWINTECH's long position.| Miwon Chemical vs. LG Chem | Miwon Chemical vs. Chunbo Co | Miwon Chemical vs. DukSan Neolux CoLtd | Miwon Chemical vs. Hyosung Chemical Corp |
| COWINTECH vs. Kbi Metal Co | COWINTECH vs. Korean Air Lines | COWINTECH vs. Heungkuk Metaltech CoLtd | COWINTECH vs. Air Busan 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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