Correlation Between Incar Financial and Osang Healthcare
Can any of the company-specific risk be diversified away by investing in both Incar Financial and Osang Healthcare 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 Osang Healthcare 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 Osang Healthcare Co,Ltd, you can compare the effects of market volatilities on Incar Financial and Osang Healthcare 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 Osang Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Incar Financial and Osang Healthcare.
Diversification Opportunities for Incar Financial and Osang Healthcare
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Incar and Osang is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Incar Financial Service and Osang Healthcare Co,Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osang Healthcare Co,Ltd 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 Osang Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osang Healthcare Co,Ltd has no effect on the direction of Incar Financial i.e., Incar Financial and Osang Healthcare go up and down completely randomly.
Pair Corralation between Incar Financial and Osang Healthcare
Assuming the 90 days trading horizon Incar Financial Service is expected to generate 1.77 times more return on investment than Osang Healthcare. However, Incar Financial is 1.77 times more volatile than Osang Healthcare Co,Ltd. It trades about 0.21 of its potential returns per unit of risk. Osang Healthcare Co,Ltd is currently generating about -0.28 per unit of risk. If you would invest 539,000 in Incar Financial Service on September 1, 2024 and sell it today you would earn a total of 104,000 from holding Incar Financial Service or generate 19.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Incar Financial Service vs. Osang Healthcare Co,Ltd
Performance |
| Timeline |
| Incar Financial Service |
| Osang Healthcare Co,Ltd |
Incar Financial and Osang Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Incar Financial and Osang Healthcare
The main advantage of trading using opposite Incar Financial and Osang Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Incar Financial position performs unexpectedly, Osang Healthcare 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 Osang Healthcare will offset losses from the drop in Osang Healthcare's long position.| Incar Financial vs. Busan Industrial Co | Incar Financial vs. Busan Ind | Incar Financial vs. Mirae Asset Daewoo | Incar Financial vs. Finebesteel |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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