Correlation Between CG Hi and Incar Financial
Can any of the company-specific risk be diversified away by investing in both CG Hi and Incar Financial 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 Incar Financial 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 Incar Financial Service, you can compare the effects of market volatilities on CG Hi and Incar Financial 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 Incar Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of CG Hi and Incar Financial.
Diversification Opportunities for CG Hi and Incar Financial
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 264660 and Incar is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding CG Hi Tech and Incar Financial Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Incar Financial Service 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 Incar Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Incar Financial Service has no effect on the direction of CG Hi i.e., CG Hi and Incar Financial go up and down completely randomly.
Pair Corralation between CG Hi and Incar Financial
Assuming the 90 days trading horizon CG Hi Tech is expected to generate 1.68 times more return on investment than Incar Financial. However, CG Hi is 1.68 times more volatile than Incar Financial Service. It trades about 0.22 of its potential returns per unit of risk. Incar Financial Service is currently generating about 0.01 per unit of risk. If you would invest 980,000 in CG Hi Tech on November 6, 2024 and sell it today you would earn a total of 173,000 from holding CG Hi Tech or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CG Hi Tech vs. Incar Financial Service
Performance |
| Timeline |
| CG Hi Tech |
| Incar Financial Service |
CG Hi and Incar Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CG Hi and Incar Financial
The main advantage of trading using opposite CG Hi and Incar Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CG Hi position performs unexpectedly, Incar Financial 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 Incar Financial will offset losses from the drop in Incar Financial's long position.| CG Hi vs. Woori Technology | CG Hi vs. AeroSpace Technology of | CG Hi vs. iNtRON Biotechnology | CG Hi vs. Sempio Foods Co |
| Incar Financial vs. Clean Science co | Incar Financial vs. Kukil Metal Co | Incar Financial vs. Nh Investment And | Incar Financial vs. Woori Technology Investment |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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