Correlation Between Cube Entertainment and InnoTherapy
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and InnoTherapy 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 InnoTherapy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and InnoTherapy, you can compare the effects of market volatilities on Cube Entertainment and InnoTherapy 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 InnoTherapy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and InnoTherapy.
Diversification Opportunities for Cube Entertainment and InnoTherapy
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cube and InnoTherapy is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and InnoTherapy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InnoTherapy 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 InnoTherapy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InnoTherapy has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and InnoTherapy go up and down completely randomly.
Pair Corralation between Cube Entertainment and InnoTherapy
Assuming the 90 days trading horizon Cube Entertainment is expected to under-perform the InnoTherapy. In addition to that, Cube Entertainment is 1.34 times more volatile than InnoTherapy. It trades about -0.01 of its total potential returns per unit of risk. InnoTherapy is currently generating about 0.01 per unit of volatility. If you would invest 885,000 in InnoTherapy on October 15, 2024 and sell it today you would earn a total of 23,000 from holding InnoTherapy or generate 2.6% 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. InnoTherapy
Performance |
| Timeline |
| Cube Entertainment |
| InnoTherapy |
Cube Entertainment and InnoTherapy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and InnoTherapy
The main advantage of trading using opposite Cube Entertainment and InnoTherapy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, InnoTherapy 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 InnoTherapy will offset losses from the drop in InnoTherapy's long position.| Cube Entertainment vs. Daesung Hi Tech Co | Cube Entertainment vs. KB Financial Group | Cube Entertainment vs. Nice Information Telecommunication | Cube Entertainment vs. Korea Computer |
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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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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