Correlation Between BGF Retail and Jin Air
Can any of the company-specific risk be diversified away by investing in both BGF Retail and Jin Air 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 BGF Retail and Jin Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BGF Retail Co and Jin Air Co, you can compare the effects of market volatilities on BGF Retail and Jin Air 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 BGF Retail with a short position of Jin Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of BGF Retail and Jin Air.
Diversification Opportunities for BGF Retail and Jin Air
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BGF and Jin is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding BGF Retail Co and Jin Air Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jin Air and BGF Retail 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 BGF Retail Co are associated (or correlated) with Jin Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jin Air has no effect on the direction of BGF Retail i.e., BGF Retail and Jin Air go up and down completely randomly.
Pair Corralation between BGF Retail and Jin Air
Assuming the 90 days trading horizon BGF Retail Co is expected to under-perform the Jin Air. But the stock apears to be less risky and, when comparing its historical volatility, BGF Retail Co is 1.2 times less risky than Jin Air. The stock trades about -0.04 of its potential returns per unit of risk. The Jin Air Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,120,000 in Jin Air Co on October 25, 2024 and sell it today you would lose (77,000) from holding Jin Air Co or give up 6.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BGF Retail Co vs. Jin Air Co
Performance |
| Timeline |
| BGF Retail |
| Jin Air |
BGF Retail and Jin Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BGF Retail and Jin Air
The main advantage of trading using opposite BGF Retail and Jin Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BGF Retail position performs unexpectedly, Jin Air 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 Jin Air will offset losses from the drop in Jin Air's long position.| BGF Retail vs. Iljin Display | BGF Retail vs. iNtRON Biotechnology | BGF Retail vs. Lotte Data Communication | BGF Retail vs. Puloon Technology |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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