Correlation Between Jin Air and TOPMATERIAL
Can any of the company-specific risk be diversified away by investing in both Jin Air and TOPMATERIAL 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 Jin Air and TOPMATERIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jin Air Co and TOPMATERIAL LTD, you can compare the effects of market volatilities on Jin Air and TOPMATERIAL 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 Jin Air with a short position of TOPMATERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jin Air and TOPMATERIAL.
Diversification Opportunities for Jin Air and TOPMATERIAL
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jin and TOPMATERIAL is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Jin Air Co and TOPMATERIAL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOPMATERIAL LTD and Jin Air 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 Jin Air Co are associated (or correlated) with TOPMATERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOPMATERIAL LTD has no effect on the direction of Jin Air i.e., Jin Air and TOPMATERIAL go up and down completely randomly.
Pair Corralation between Jin Air and TOPMATERIAL
Assuming the 90 days trading horizon Jin Air Co is expected to under-perform the TOPMATERIAL. But the stock apears to be less risky and, when comparing its historical volatility, Jin Air Co is 2.01 times less risky than TOPMATERIAL. The stock trades about -0.02 of its potential returns per unit of risk. The TOPMATERIAL LTD is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,635,000 in TOPMATERIAL LTD on September 3, 2024 and sell it today you would lose (745,000) from holding TOPMATERIAL LTD or give up 20.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jin Air Co vs. TOPMATERIAL LTD
Performance |
| Timeline |
| Jin Air |
| TOPMATERIAL LTD |
Jin Air and TOPMATERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jin Air and TOPMATERIAL
The main advantage of trading using opposite Jin Air and TOPMATERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jin Air position performs unexpectedly, TOPMATERIAL 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 TOPMATERIAL will offset losses from the drop in TOPMATERIAL's long position.| Jin Air vs. DataSolution | Jin Air vs. Alton Sports CoLtd | Jin Air vs. SCI Information Service | Jin Air vs. Shinsegae Food |
| TOPMATERIAL vs. Samsung Electronics Co | TOPMATERIAL vs. Samsung Electronics Co | TOPMATERIAL vs. LG Energy Solution | TOPMATERIAL vs. SK Hynix |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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