Correlation Between Next Entertainment and Tae Kyung
Can any of the company-specific risk be diversified away by investing in both Next Entertainment and Tae Kyung 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 Next Entertainment and Tae Kyung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Next Entertainment World and Tae Kyung Chemical, you can compare the effects of market volatilities on Next Entertainment and Tae Kyung 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 Next Entertainment with a short position of Tae Kyung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Next Entertainment and Tae Kyung.
Diversification Opportunities for Next Entertainment and Tae Kyung
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Next and Tae is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Next Entertainment World and Tae Kyung Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tae Kyung Chemical and Next Entertainment 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 Next Entertainment World are associated (or correlated) with Tae Kyung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tae Kyung Chemical has no effect on the direction of Next Entertainment i.e., Next Entertainment and Tae Kyung go up and down completely randomly.
Pair Corralation between Next Entertainment and Tae Kyung
Assuming the 90 days trading horizon Next Entertainment World is expected to generate 1.46 times more return on investment than Tae Kyung. However, Next Entertainment is 1.46 times more volatile than Tae Kyung Chemical. It trades about 0.08 of its potential returns per unit of risk. Tae Kyung Chemical is currently generating about 0.0 per unit of risk. If you would invest 229,000 in Next Entertainment World on October 24, 2024 and sell it today you would earn a total of 7,500 from holding Next Entertainment World or generate 3.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Next Entertainment World vs. Tae Kyung Chemical
Performance |
| Timeline |
| Next Entertainment World |
| Tae Kyung Chemical |
Next Entertainment and Tae Kyung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Next Entertainment and Tae Kyung
The main advantage of trading using opposite Next Entertainment and Tae Kyung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Next Entertainment position performs unexpectedly, Tae Kyung 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 Tae Kyung will offset losses from the drop in Tae Kyung's long position.| Next Entertainment vs. SV Investment | Next Entertainment vs. SBI Investment KOREA | Next Entertainment vs. Songwon Industrial Co | Next Entertainment vs. DSC Investment |
| Tae Kyung vs. AptaBio Therapeutics | Tae Kyung vs. Daewoo SBI SPAC | Tae Kyung vs. Dream Security co | Tae Kyung 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |