Correlation Between Cube Entertainment and Nable Communications
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and Nable Communications 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 Nable Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and Nable Communications, you can compare the effects of market volatilities on Cube Entertainment and Nable Communications 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 Nable Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and Nable Communications.
Diversification Opportunities for Cube Entertainment and Nable Communications
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cube and Nable is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and Nable Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nable Communications 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 Nable Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nable Communications has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and Nable Communications go up and down completely randomly.
Pair Corralation between Cube Entertainment and Nable Communications
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 1.23 times less return on investment than Nable Communications. In addition to that, Cube Entertainment is 2.22 times more volatile than Nable Communications. It trades about 0.12 of its total potential returns per unit of risk. Nable Communications is currently generating about 0.32 per unit of volatility. If you would invest 617,000 in Nable Communications on September 13, 2024 and sell it today you would earn a total of 71,000 from holding Nable Communications or generate 11.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cube Entertainment vs. Nable Communications
Performance |
| Timeline |
| Cube Entertainment |
| Nable Communications |
Cube Entertainment and Nable Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and Nable Communications
The main advantage of trading using opposite Cube Entertainment and Nable Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, Nable Communications 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 Nable Communications will offset losses from the drop in Nable Communications' long position.| Cube Entertainment vs. Daishin Information Communications | Cube Entertainment vs. CG Hi Tech | Cube Entertainment vs. Samyoung Electronics Co | Cube Entertainment vs. Derkwoo Electronics Co |
| Nable Communications vs. Cube Entertainment | Nable Communications vs. Dreamus Company | Nable Communications vs. LG Energy Solution | Nable Communications 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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