Correlation Between Incar Financial and Korea Real
Can any of the company-specific risk be diversified away by investing in both Incar Financial and Korea Real 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 Incar Financial and Korea Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Incar Financial Service and Korea Real Estate, you can compare the effects of market volatilities on Incar Financial and Korea Real 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 Incar Financial with a short position of Korea Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Incar Financial and Korea Real.
Diversification Opportunities for Incar Financial and Korea Real
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Incar and Korea is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Incar Financial Service and Korea Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Real Estate and Incar Financial 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 Incar Financial Service are associated (or correlated) with Korea Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Real Estate has no effect on the direction of Incar Financial i.e., Incar Financial and Korea Real go up and down completely randomly.
Pair Corralation between Incar Financial and Korea Real
Assuming the 90 days trading horizon Incar Financial Service is expected to generate 5.51 times more return on investment than Korea Real. However, Incar Financial is 5.51 times more volatile than Korea Real Estate. It trades about 0.01 of its potential returns per unit of risk. Korea Real Estate is currently generating about -0.06 per unit of risk. If you would invest 1,489,131 in Incar Financial Service on September 2, 2024 and sell it today you would lose (846,131) from holding Incar Financial Service or give up 56.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 97.24% |
| Values | Daily Returns |
Incar Financial Service vs. Korea Real Estate
Performance |
| Timeline |
| Incar Financial Service |
| Korea Real Estate |
Incar Financial and Korea Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Incar Financial and Korea Real
The main advantage of trading using opposite Incar Financial and Korea Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Incar Financial position performs unexpectedly, Korea Real 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 Korea Real will offset losses from the drop in Korea Real's long position.| Incar Financial vs. PLAYWITH | Incar Financial vs. Chorokbaem Healthcare Co | Incar Financial vs. Nable Communications | Incar Financial vs. INFINITT Healthcare Co |
| Korea Real vs. Samsung Electronics Co | Korea Real vs. Samsung Electronics Co | Korea Real vs. LG Energy Solution | Korea Real vs. SK Hynix |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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