Correlation Between TS Investment and GemVaxKAEL CoLtd
Can any of the company-specific risk be diversified away by investing in both TS Investment and GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd, you can compare the effects of market volatilities on TS Investment and GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of TS Investment and GemVaxKAEL CoLtd.
Diversification Opportunities for TS Investment and GemVaxKAEL CoLtd
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 246690 and GemVaxKAEL is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding TS Investment Corp and GemVaxKAEL CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GemVaxKAEL CoLtd has no effect on the direction of TS Investment i.e., TS Investment and GemVaxKAEL CoLtd go up and down completely randomly.
Pair Corralation between TS Investment and GemVaxKAEL CoLtd
Assuming the 90 days trading horizon TS Investment is expected to generate 85.34 times less return on investment than GemVaxKAEL CoLtd. But when comparing it to its historical volatility, TS Investment Corp is 1.71 times less risky than GemVaxKAEL CoLtd. It trades about 0.01 of its potential returns per unit of risk. GemVaxKAEL CoLtd is currently generating about 0.41 of returns per unit of risk over similar time horizon. If you would invest 1,517,000 in GemVaxKAEL CoLtd on November 4, 2024 and sell it today you would earn a total of 370,000 from holding GemVaxKAEL CoLtd or generate 24.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TS Investment Corp vs. GemVaxKAEL CoLtd
Performance |
| Timeline |
| TS Investment Corp |
| GemVaxKAEL CoLtd |
TS Investment and GemVaxKAEL CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TS Investment and GemVaxKAEL CoLtd
The main advantage of trading using opposite TS Investment and GemVaxKAEL CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TS Investment position performs unexpectedly, GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd will offset losses from the drop in GemVaxKAEL CoLtd's long position.| TS Investment vs. Lee Ku Industrial | TS Investment vs. Korea Industrial Co | TS Investment vs. Organic Special Pet | TS Investment vs. Dongil Metal Co |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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