Correlation Between Kolon Plastics and Netmarble Games
Can any of the company-specific risk be diversified away by investing in both Kolon Plastics and Netmarble Games 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 Kolon Plastics and Netmarble Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kolon Plastics and Netmarble Games Corp, you can compare the effects of market volatilities on Kolon Plastics and Netmarble Games 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 Kolon Plastics with a short position of Netmarble Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kolon Plastics and Netmarble Games.
Diversification Opportunities for Kolon Plastics and Netmarble Games
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kolon and Netmarble is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Kolon Plastics and Netmarble Games Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netmarble Games Corp and Kolon Plastics 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 Kolon Plastics are associated (or correlated) with Netmarble Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netmarble Games Corp has no effect on the direction of Kolon Plastics i.e., Kolon Plastics and Netmarble Games go up and down completely randomly.
Pair Corralation between Kolon Plastics and Netmarble Games
Assuming the 90 days trading horizon Kolon Plastics is expected to generate 0.88 times more return on investment than Netmarble Games. However, Kolon Plastics is 1.14 times less risky than Netmarble Games. It trades about -0.09 of its potential returns per unit of risk. Netmarble Games Corp is currently generating about -0.46 per unit of risk. If you would invest 558,000 in Kolon Plastics on October 25, 2024 and sell it today you would lose (19,000) from holding Kolon Plastics or give up 3.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kolon Plastics vs. Netmarble Games Corp
Performance |
| Timeline |
| Kolon Plastics |
| Netmarble Games Corp |
Kolon Plastics and Netmarble Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kolon Plastics and Netmarble Games
The main advantage of trading using opposite Kolon Plastics and Netmarble Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kolon Plastics position performs unexpectedly, Netmarble Games 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 Netmarble Games will offset losses from the drop in Netmarble Games' long position.| Kolon Plastics vs. Atinum Investment Co | Kolon Plastics vs. Korea Investment Holdings | Kolon Plastics vs. DB Financial Investment | Kolon Plastics vs. SV Investment |
| Netmarble Games vs. Busan Industrial Co | Netmarble Games vs. Busan Ind | Netmarble Games vs. RPBio Inc | Netmarble Games vs. Finebesteel |
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 Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |