Correlation Between Cuckoo Electronics and Wonil Special
Can any of the company-specific risk be diversified away by investing in both Cuckoo Electronics and Wonil Special 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 Cuckoo Electronics and Wonil Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cuckoo Electronics Co and Wonil Special Steel, you can compare the effects of market volatilities on Cuckoo Electronics and Wonil Special 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 Cuckoo Electronics with a short position of Wonil Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cuckoo Electronics and Wonil Special.
Diversification Opportunities for Cuckoo Electronics and Wonil Special
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cuckoo and Wonil is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Cuckoo Electronics Co and Wonil Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonil Special Steel and Cuckoo Electronics 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 Cuckoo Electronics Co are associated (or correlated) with Wonil Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonil Special Steel has no effect on the direction of Cuckoo Electronics i.e., Cuckoo Electronics and Wonil Special go up and down completely randomly.
Pair Corralation between Cuckoo Electronics and Wonil Special
Assuming the 90 days trading horizon Cuckoo Electronics Co is expected to generate 1.45 times more return on investment than Wonil Special. However, Cuckoo Electronics is 1.45 times more volatile than Wonil Special Steel. It trades about 0.06 of its potential returns per unit of risk. Wonil Special Steel is currently generating about -0.04 per unit of risk. If you would invest 1,490,857 in Cuckoo Electronics Co on September 4, 2024 and sell it today you would earn a total of 799,143 from holding Cuckoo Electronics Co or generate 53.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cuckoo Electronics Co vs. Wonil Special Steel
Performance |
| Timeline |
| Cuckoo Electronics |
| Wonil Special Steel |
Cuckoo Electronics and Wonil Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cuckoo Electronics and Wonil Special
The main advantage of trading using opposite Cuckoo Electronics and Wonil Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cuckoo Electronics position performs unexpectedly, Wonil Special 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 Wonil Special will offset losses from the drop in Wonil Special's long position.| Cuckoo Electronics vs. Korea Real Estate | Cuckoo Electronics vs. Busan Industrial Co | Cuckoo Electronics vs. UNISEM Co | Cuckoo Electronics vs. RPBio Inc |
| Wonil Special vs. Hanjin Transportation Co | Wonil Special vs. Hankook Furniture Co | Wonil Special vs. CU Tech Corp | Wonil Special vs. Woori Technology |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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