Correlation Between TS Investment and POSCO Holdings
Can any of the company-specific risk be diversified away by investing in both TS Investment and POSCO Holdings 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 TS Investment and POSCO Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TS Investment Corp and POSCO Holdings, you can compare the effects of market volatilities on TS Investment and POSCO Holdings 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 TS Investment with a short position of POSCO Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of TS Investment and POSCO Holdings.
Diversification Opportunities for TS Investment and POSCO Holdings
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 246690 and POSCO is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding TS Investment Corp and POSCO Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POSCO Holdings and TS Investment 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 TS Investment Corp are associated (or correlated) with POSCO Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POSCO Holdings has no effect on the direction of TS Investment i.e., TS Investment and POSCO Holdings go up and down completely randomly.
Pair Corralation between TS Investment and POSCO Holdings
Assuming the 90 days trading horizon TS Investment Corp is expected to under-perform the POSCO Holdings. But the stock apears to be less risky and, when comparing its historical volatility, TS Investment Corp is 1.29 times less risky than POSCO Holdings. The stock trades about -0.05 of its potential returns per unit of risk. The POSCO Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 29,054,700 in POSCO Holdings on October 20, 2024 and sell it today you would lose (3,054,700) from holding POSCO Holdings or give up 10.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TS Investment Corp vs. POSCO Holdings
Performance |
| Timeline |
| TS Investment Corp |
| POSCO Holdings |
TS Investment and POSCO Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TS Investment and POSCO Holdings
The main advantage of trading using opposite TS Investment and POSCO Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TS Investment position performs unexpectedly, POSCO Holdings 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 POSCO Holdings will offset losses from the drop in POSCO Holdings' long position.| TS Investment vs. Hankukpackage Co | TS Investment vs. Global Standard Technology | TS Investment vs. Ilji Technology Co | TS Investment vs. Daou Technology |
| POSCO Holdings vs. Formetal Co | POSCO Holdings vs. DSC Investment | POSCO Holdings vs. LEENO Industrial | POSCO Holdings vs. TS Investment Corp |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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