Correlation Between Xavis and KG Eco
Can any of the company-specific risk be diversified away by investing in both Xavis and KG Eco 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 Xavis and KG Eco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xavis Co and KG Eco Technology, you can compare the effects of market volatilities on Xavis and KG Eco 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 Xavis with a short position of KG Eco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xavis and KG Eco.
Diversification Opportunities for Xavis and KG Eco
Very weak diversification
The 3 months correlation between Xavis and 151860 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Xavis Co and KG Eco Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KG Eco Technology and Xavis 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 Xavis Co are associated (or correlated) with KG Eco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KG Eco Technology has no effect on the direction of Xavis i.e., Xavis and KG Eco go up and down completely randomly.
Pair Corralation between Xavis and KG Eco
Assuming the 90 days trading horizon Xavis Co is expected to generate 1.21 times more return on investment than KG Eco. However, Xavis is 1.21 times more volatile than KG Eco Technology. It trades about 0.0 of its potential returns per unit of risk. KG Eco Technology is currently generating about -0.02 per unit of risk. If you would invest 209,925 in Xavis Co on October 23, 2024 and sell it today you would lose (75,125) from holding Xavis Co or give up 35.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Xavis Co vs. KG Eco Technology
Performance |
| Timeline |
| Xavis |
| KG Eco Technology |
Xavis and KG Eco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xavis and KG Eco
The main advantage of trading using opposite Xavis and KG Eco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xavis position performs unexpectedly, KG Eco 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 KG Eco will offset losses from the drop in KG Eco's long position.| Xavis vs. Ecoplastic | Xavis vs. Ssangyong Materials Corp | Xavis vs. Sungmoon Electronics Co | Xavis vs. Top Material Co |
| KG Eco vs. Samsung Electronics Co | KG Eco vs. Samsung Electronics Co | KG Eco vs. SK Hynix | KG Eco vs. HMM 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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