Correlation Between Lion Chemtech and Yura Tech
Can any of the company-specific risk be diversified away by investing in both Lion Chemtech and Yura Tech 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 Lion Chemtech and Yura Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lion Chemtech Co and Yura Tech Co, you can compare the effects of market volatilities on Lion Chemtech and Yura Tech 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 Lion Chemtech with a short position of Yura Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lion Chemtech and Yura Tech.
Diversification Opportunities for Lion Chemtech and Yura Tech
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lion and Yura is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Lion Chemtech Co and Yura Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yura Tech and Lion Chemtech 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 Lion Chemtech Co are associated (or correlated) with Yura Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yura Tech has no effect on the direction of Lion Chemtech i.e., Lion Chemtech and Yura Tech go up and down completely randomly.
Pair Corralation between Lion Chemtech and Yura Tech
Assuming the 90 days trading horizon Lion Chemtech Co is expected to under-perform the Yura Tech. In addition to that, Lion Chemtech is 1.96 times more volatile than Yura Tech Co. It trades about -0.13 of its total potential returns per unit of risk. Yura Tech Co is currently generating about 0.24 per unit of volatility. If you would invest 741,605 in Yura Tech Co on October 21, 2024 and sell it today you would earn a total of 65,395 from holding Yura Tech Co or generate 8.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lion Chemtech Co vs. Yura Tech Co
Performance |
| Timeline |
| Lion Chemtech |
| Yura Tech |
Lion Chemtech and Yura Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lion Chemtech and Yura Tech
The main advantage of trading using opposite Lion Chemtech and Yura Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lion Chemtech position performs unexpectedly, Yura Tech 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 Yura Tech will offset losses from the drop in Yura Tech's long position.| Lion Chemtech vs. RFTech Co | Lion Chemtech vs. Shinhan Inverse Silver | Lion Chemtech vs. Hanmi Semiconductor Co | Lion Chemtech vs. A Tech Solution Co |
| Yura Tech vs. Woori Technology Investment | Yura Tech vs. E Investment Development | Yura Tech vs. EBEST Investment Securities | Yura Tech vs. Samyung Trading 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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