Correlation Between Cube Entertainment and ChipsMedia
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and ChipsMedia 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 Cube Entertainment and ChipsMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and ChipsMedia, you can compare the effects of market volatilities on Cube Entertainment and ChipsMedia 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 Cube Entertainment with a short position of ChipsMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and ChipsMedia.
Diversification Opportunities for Cube Entertainment and ChipsMedia
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cube and ChipsMedia is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and ChipsMedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChipsMedia and Cube 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 Cube Entertainment are associated (or correlated) with ChipsMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChipsMedia has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and ChipsMedia go up and down completely randomly.
Pair Corralation between Cube Entertainment and ChipsMedia
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 0.85 times more return on investment than ChipsMedia. However, Cube Entertainment is 1.18 times less risky than ChipsMedia. It trades about 0.37 of its potential returns per unit of risk. ChipsMedia is currently generating about 0.07 per unit of risk. If you would invest 1,301,000 in Cube Entertainment on August 31, 2024 and sell it today you would earn a total of 323,000 from holding Cube Entertainment or generate 24.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cube Entertainment vs. ChipsMedia
Performance |
| Timeline |
| Cube Entertainment |
| ChipsMedia |
Cube Entertainment and ChipsMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and ChipsMedia
The main advantage of trading using opposite Cube Entertainment and ChipsMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, ChipsMedia 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 ChipsMedia will offset losses from the drop in ChipsMedia's long position.| Cube Entertainment vs. Samsung Electronics Co | Cube Entertainment vs. Samsung Electronics Co | Cube Entertainment vs. LG Energy Solution | Cube Entertainment vs. SK Hynix |
| ChipsMedia vs. Kukil Metal Co | ChipsMedia vs. SH Energy Chemical | ChipsMedia vs. Daejung Chemicals Metals | ChipsMedia vs. LG Chemicals |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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