Correlation Between JC Chemical and Youl Chon
Can any of the company-specific risk be diversified away by investing in both JC Chemical and Youl Chon 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 JC Chemical and Youl Chon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JC Chemical Co and Youl Chon Chemical, you can compare the effects of market volatilities on JC Chemical and Youl Chon 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 JC Chemical with a short position of Youl Chon. Check out your portfolio center. Please also check ongoing floating volatility patterns of JC Chemical and Youl Chon.
Diversification Opportunities for JC Chemical and Youl Chon
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 137950 and Youl is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding JC Chemical Co and Youl Chon Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youl Chon Chemical and JC 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 JC Chemical Co are associated (or correlated) with Youl Chon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youl Chon Chemical has no effect on the direction of JC Chemical i.e., JC Chemical and Youl Chon go up and down completely randomly.
Pair Corralation between JC Chemical and Youl Chon
Assuming the 90 days trading horizon JC Chemical Co is expected to generate 0.23 times more return on investment than Youl Chon. However, JC Chemical Co is 4.29 times less risky than Youl Chon. It trades about 0.16 of its potential returns per unit of risk. Youl Chon Chemical is currently generating about 0.0 per unit of risk. If you would invest 360,500 in JC Chemical Co on November 28, 2024 and sell it today you would earn a total of 17,000 from holding JC Chemical Co or generate 4.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
JC Chemical Co vs. Youl Chon Chemical
Performance |
| Timeline |
| JC Chemical |
| Youl Chon Chemical |
JC Chemical and Youl Chon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JC Chemical and Youl Chon
The main advantage of trading using opposite JC Chemical and Youl Chon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JC Chemical position performs unexpectedly, Youl Chon 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 Youl Chon will offset losses from the drop in Youl Chon's long position.| JC Chemical vs. BNK Financial Group | JC Chemical vs. Industrial Bank | JC Chemical vs. Seoul Food Industrial | JC Chemical vs. DB Insurance Co |
| Youl Chon vs. Daesung Hi Tech Co | Youl Chon vs. Busan Industrial Co | Youl Chon vs. Formetal Co | Youl Chon vs. DB Insurance 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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