Correlation Between Microfriend and CJ Seafood
Can any of the company-specific risk be diversified away by investing in both Microfriend and CJ Seafood 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 Microfriend and CJ Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microfriend and CJ Seafood Corp, you can compare the effects of market volatilities on Microfriend and CJ Seafood 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 Microfriend with a short position of CJ Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microfriend and CJ Seafood.
Diversification Opportunities for Microfriend and CJ Seafood
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Microfriend and 011150 is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Microfriend and CJ Seafood Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ Seafood Corp and Microfriend 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 Microfriend are associated (or correlated) with CJ Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ Seafood Corp has no effect on the direction of Microfriend i.e., Microfriend and CJ Seafood go up and down completely randomly.
Pair Corralation between Microfriend and CJ Seafood
Assuming the 90 days trading horizon Microfriend is expected to under-perform the CJ Seafood. In addition to that, Microfriend is 1.05 times more volatile than CJ Seafood Corp. It trades about -0.08 of its total potential returns per unit of risk. CJ Seafood Corp is currently generating about 0.02 per unit of volatility. If you would invest 281,000 in CJ Seafood Corp on August 25, 2024 and sell it today you would earn a total of 9,000 from holding CJ Seafood Corp or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microfriend vs. CJ Seafood Corp
Performance |
| Timeline |
| Microfriend |
| CJ Seafood Corp |
Microfriend and CJ Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microfriend and CJ Seafood
The main advantage of trading using opposite Microfriend and CJ Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microfriend position performs unexpectedly, CJ Seafood 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 CJ Seafood will offset losses from the drop in CJ Seafood's long position.| Microfriend vs. PJ Metal Co | Microfriend vs. Eagon Industrial Co | Microfriend vs. Lotte Data Communication | Microfriend vs. Mobile Appliance |
| CJ Seafood vs. AptaBio Therapeutics | CJ Seafood vs. Daewoo SBI SPAC | CJ Seafood vs. Dream Security co | CJ Seafood vs. Microfriend |
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 Managers module to screen money managers from public funds and ETFs managed around the world.
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