Correlation Between Cube Entertainment and Jb Financial
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and Jb Financial 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 Jb Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and Jb Financial, you can compare the effects of market volatilities on Cube Entertainment and Jb Financial 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 Jb Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and Jb Financial.
Diversification Opportunities for Cube Entertainment and Jb Financial
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Cube and 175330 is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and Jb Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jb Financial 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 Jb Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jb Financial has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and Jb Financial go up and down completely randomly.
Pair Corralation between Cube Entertainment and Jb Financial
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 1.9 times less return on investment than Jb Financial. In addition to that, Cube Entertainment is 1.44 times more volatile than Jb Financial. It trades about 0.05 of its total potential returns per unit of risk. Jb Financial is currently generating about 0.14 per unit of volatility. If you would invest 1,412,909 in Jb Financial on September 1, 2024 and sell it today you would earn a total of 555,091 from holding Jb Financial or generate 39.29% 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. Jb Financial
Performance |
| Timeline |
| Cube Entertainment |
| Jb Financial |
Cube Entertainment and Jb Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and Jb Financial
The main advantage of trading using opposite Cube Entertainment and Jb Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, Jb Financial 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 Jb Financial will offset losses from the drop in Jb Financial's long position.The idea behind Cube Entertainment and Jb Financial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Jb Financial vs. Samsung Electronics Co | Jb Financial vs. Samsung Electronics Co | Jb Financial vs. KB Financial Group | Jb Financial vs. Shinhan Financial Group |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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