Correlation Between Miwon Chemicals and Korean Air
Can any of the company-specific risk be diversified away by investing in both Miwon Chemicals and Korean Air 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 Chemicals and Korean Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Miwon Chemicals Co and Korean Air Lines, you can compare the effects of market volatilities on Miwon Chemicals and Korean Air 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 Chemicals with a short position of Korean Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Miwon Chemicals and Korean Air.
Diversification Opportunities for Miwon Chemicals and Korean Air
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Miwon and Korean is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Miwon Chemicals Co and Korean Air Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korean Air Lines and Miwon Chemicals 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 Chemicals Co are associated (or correlated) with Korean Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korean Air Lines has no effect on the direction of Miwon Chemicals i.e., Miwon Chemicals and Korean Air go up and down completely randomly.
Pair Corralation between Miwon Chemicals and Korean Air
Assuming the 90 days trading horizon Miwon Chemicals Co is expected to generate 0.68 times more return on investment than Korean Air. However, Miwon Chemicals Co is 1.47 times less risky than Korean Air. It trades about 0.06 of its potential returns per unit of risk. Korean Air Lines is currently generating about 0.0 per unit of risk. If you would invest 6,005,767 in Miwon Chemicals Co on October 13, 2024 and sell it today you would earn a total of 1,874,233 from holding Miwon Chemicals Co or generate 31.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Miwon Chemicals Co vs. Korean Air Lines
Performance |
| Timeline |
| Miwon Chemicals |
| Korean Air Lines |
Miwon Chemicals and Korean Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Miwon Chemicals and Korean Air
The main advantage of trading using opposite Miwon Chemicals and Korean Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Miwon Chemicals position performs unexpectedly, Korean Air 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 Korean Air will offset losses from the drop in Korean Air's long position.| Miwon Chemicals vs. Kolon Plastics | Miwon Chemicals vs. Korea Air Svc | Miwon Chemicals vs. Jeju Air Co | Miwon Chemicals vs. WONIK Materials CoLtd |
| Korean Air vs. DB Insurance Co | Korean Air vs. BNK Financial Group | Korean Air vs. Jeju Bank | Korean Air vs. Youl Chon Chemical |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |