Correlation Between Netmarble Games and Lotte Chilsung
Can any of the company-specific risk be diversified away by investing in both Netmarble Games and Lotte Chilsung 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 Netmarble Games and Lotte Chilsung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netmarble Games Corp and Lotte Chilsung Beverage, you can compare the effects of market volatilities on Netmarble Games and Lotte Chilsung 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 Netmarble Games with a short position of Lotte Chilsung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netmarble Games and Lotte Chilsung.
Diversification Opportunities for Netmarble Games and Lotte Chilsung
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Netmarble and Lotte is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Netmarble Games Corp and Lotte Chilsung Beverage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Chilsung Beverage and Netmarble Games 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 Netmarble Games Corp are associated (or correlated) with Lotte Chilsung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Chilsung Beverage has no effect on the direction of Netmarble Games i.e., Netmarble Games and Lotte Chilsung go up and down completely randomly.
Pair Corralation between Netmarble Games and Lotte Chilsung
Assuming the 90 days trading horizon Netmarble Games Corp is expected to under-perform the Lotte Chilsung. In addition to that, Netmarble Games is 1.42 times more volatile than Lotte Chilsung Beverage. It trades about -0.12 of its total potential returns per unit of risk. Lotte Chilsung Beverage is currently generating about 0.01 per unit of volatility. If you would invest 11,830,000 in Lotte Chilsung Beverage on August 28, 2024 and sell it today you would lose (10,000) from holding Lotte Chilsung Beverage or give up 0.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Netmarble Games Corp vs. Lotte Chilsung Beverage
Performance |
| Timeline |
| Netmarble Games Corp |
| Lotte Chilsung Beverage |
Netmarble Games and Lotte Chilsung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netmarble Games and Lotte Chilsung
The main advantage of trading using opposite Netmarble Games and Lotte Chilsung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netmarble Games position performs unexpectedly, Lotte Chilsung 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 Lotte Chilsung will offset losses from the drop in Lotte Chilsung's long position.| Netmarble Games vs. AfreecaTV Co | Netmarble Games vs. SS TECH | Netmarble Games vs. Busan Industrial Co | Netmarble Games vs. Busan Ind |
| Lotte Chilsung vs. AptaBio Therapeutics | Lotte Chilsung vs. Daewoo SBI SPAC | Lotte Chilsung vs. Dream Security co | Lotte Chilsung vs. Microfriend |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |