Correlation Between Lotte Data and Narae Nanotech
Can any of the company-specific risk be diversified away by investing in both Lotte Data and Narae Nanotech 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 Lotte Data and Narae Nanotech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Data Communication and Narae Nanotech Corp, you can compare the effects of market volatilities on Lotte Data and Narae Nanotech 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 Lotte Data with a short position of Narae Nanotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Data and Narae Nanotech.
Diversification Opportunities for Lotte Data and Narae Nanotech
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Lotte and Narae is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Data Communication and Narae Nanotech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Narae Nanotech Corp and Lotte Data 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 Lotte Data Communication are associated (or correlated) with Narae Nanotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Narae Nanotech Corp has no effect on the direction of Lotte Data i.e., Lotte Data and Narae Nanotech go up and down completely randomly.
Pair Corralation between Lotte Data and Narae Nanotech
Assuming the 90 days trading horizon Lotte Data Communication is expected to generate 1.05 times more return on investment than Narae Nanotech. However, Lotte Data is 1.05 times more volatile than Narae Nanotech Corp. It trades about 0.0 of its potential returns per unit of risk. Narae Nanotech Corp is currently generating about -0.05 per unit of risk. If you would invest 2,677,998 in Lotte Data Communication on October 26, 2024 and sell it today you would lose (695,998) from holding Lotte Data Communication or give up 25.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Data Communication vs. Narae Nanotech Corp
Performance |
| Timeline |
| Lotte Data Communication |
| Narae Nanotech Corp |
Lotte Data and Narae Nanotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Data and Narae Nanotech
The main advantage of trading using opposite Lotte Data and Narae Nanotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Data position performs unexpectedly, Narae Nanotech 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 Narae Nanotech will offset losses from the drop in Narae Nanotech's long position.| Lotte Data vs. SS TECH | Lotte Data vs. FNSTech Co | Lotte Data vs. PNC Technologies co | Lotte Data vs. Seoul Food Industrial |
| Narae Nanotech vs. Elentec Co | Narae Nanotech vs. Robostar CoLtd | Narae Nanotech vs. HyVision System | Narae Nanotech vs. Daebo Magnetic CoLtd |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |