Correlation Between CG Hi and Bohae Brewery
Can any of the company-specific risk be diversified away by investing in both CG Hi and Bohae Brewery 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 CG Hi and Bohae Brewery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CG Hi Tech and Bohae Brewery, you can compare the effects of market volatilities on CG Hi and Bohae Brewery 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 CG Hi with a short position of Bohae Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of CG Hi and Bohae Brewery.
Diversification Opportunities for CG Hi and Bohae Brewery
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between 264660 and Bohae is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding CG Hi Tech and Bohae Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bohae Brewery and CG Hi 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 CG Hi Tech are associated (or correlated) with Bohae Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bohae Brewery has no effect on the direction of CG Hi i.e., CG Hi and Bohae Brewery go up and down completely randomly.
Pair Corralation between CG Hi and Bohae Brewery
Assuming the 90 days trading horizon CG Hi Tech is expected to under-perform the Bohae Brewery. But the stock apears to be less risky and, when comparing its historical volatility, CG Hi Tech is 1.4 times less risky than Bohae Brewery. The stock trades about -0.1 of its potential returns per unit of risk. The Bohae Brewery is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 48,500 in Bohae Brewery on August 31, 2024 and sell it today you would lose (1,900) from holding Bohae Brewery or give up 3.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CG Hi Tech vs. Bohae Brewery
Performance |
| Timeline |
| CG Hi Tech |
| Bohae Brewery |
CG Hi and Bohae Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CG Hi and Bohae Brewery
The main advantage of trading using opposite CG Hi and Bohae Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CG Hi position performs unexpectedly, Bohae Brewery 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 Bohae Brewery will offset losses from the drop in Bohae Brewery's long position.| CG Hi vs. Shinsung Delta Tech | CG Hi vs. Yura Tech Co | CG Hi vs. iNtRON Biotechnology | CG Hi vs. A Tech Solution Co |
| Bohae Brewery vs. Korea Real Estate | Bohae Brewery vs. Korea Ratings Co | Bohae Brewery vs. IQuest Co | Bohae Brewery vs. Wonbang Tech 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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