Correlation Between SIMMTECH and Cube Entertainment
Can any of the company-specific risk be diversified away by investing in both SIMMTECH and Cube Entertainment 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 SIMMTECH and Cube Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIMMTECH Co and Cube Entertainment, you can compare the effects of market volatilities on SIMMTECH and Cube Entertainment 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 SIMMTECH with a short position of Cube Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIMMTECH and Cube Entertainment.
Diversification Opportunities for SIMMTECH and Cube Entertainment
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SIMMTECH and Cube is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding SIMMTECH Co and Cube Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cube Entertainment and SIMMTECH 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 SIMMTECH Co are associated (or correlated) with Cube Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cube Entertainment has no effect on the direction of SIMMTECH i.e., SIMMTECH and Cube Entertainment go up and down completely randomly.
Pair Corralation between SIMMTECH and Cube Entertainment
Assuming the 90 days trading horizon SIMMTECH Co is expected to under-perform the Cube Entertainment. But the stock apears to be less risky and, when comparing its historical volatility, SIMMTECH Co is 1.13 times less risky than Cube Entertainment. The stock trades about -0.23 of its potential returns per unit of risk. The Cube Entertainment is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,423,000 in Cube Entertainment on September 13, 2024 and sell it today you would earn a total of 115,000 from holding Cube Entertainment or generate 8.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIMMTECH Co vs. Cube Entertainment
Performance |
| Timeline |
| SIMMTECH |
| Cube Entertainment |
SIMMTECH and Cube Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIMMTECH and Cube Entertainment
The main advantage of trading using opposite SIMMTECH and Cube Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIMMTECH position performs unexpectedly, Cube Entertainment 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 Cube Entertainment will offset losses from the drop in Cube Entertainment's long position.| SIMMTECH vs. DB Insurance Co | SIMMTECH vs. Chin Yang Chemical | SIMMTECH vs. TK Chemical | SIMMTECH vs. Hanmi Semiconductor Co |
| Cube Entertainment vs. Daishin Information Communications | Cube Entertainment vs. CG Hi Tech | Cube Entertainment vs. Samyoung Electronics Co | Cube Entertainment vs. Derkwoo Electronics Co |
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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