Correlation Between Cube Entertainment and Puloon Technology
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and Puloon Technology 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 Puloon Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and Puloon Technology, you can compare the effects of market volatilities on Cube Entertainment and Puloon Technology 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 Puloon Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and Puloon Technology.
Diversification Opportunities for Cube Entertainment and Puloon Technology
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cube and Puloon is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and Puloon Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puloon Technology 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 Puloon Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puloon Technology has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and Puloon Technology go up and down completely randomly.
Pair Corralation between Cube Entertainment and Puloon Technology
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 1.2 times more return on investment than Puloon Technology. However, Cube Entertainment is 1.2 times more volatile than Puloon Technology. It trades about 0.03 of its potential returns per unit of risk. Puloon Technology is currently generating about -0.02 per unit of risk. If you would invest 1,453,000 in Cube Entertainment on September 21, 2024 and sell it today you would earn a total of 180,000 from holding Cube Entertainment or generate 12.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cube Entertainment vs. Puloon Technology
Performance |
| Timeline |
| Cube Entertainment |
| Puloon Technology |
Cube Entertainment and Puloon Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and Puloon Technology
The main advantage of trading using opposite Cube Entertainment and Puloon Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, Puloon Technology 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 Puloon Technology will offset losses from the drop in Puloon Technology's long position.| Cube Entertainment vs. Taegu Broadcasting | Cube Entertainment vs. Iljin Display | Cube Entertainment vs. Daishin Information Communications | Cube Entertainment vs. Digital Power Communications |
| Puloon Technology vs. Cube Entertainment | Puloon Technology vs. Dreamus Company | Puloon Technology vs. LG Energy Solution | Puloon Technology vs. Dongwon System |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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