Correlation Between Lotte Data and WooDeumGee Farm
Can any of the company-specific risk be diversified away by investing in both Lotte Data and WooDeumGee Farm 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 WooDeumGee Farm 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 WooDeumGee Farm Co,, you can compare the effects of market volatilities on Lotte Data and WooDeumGee Farm 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 WooDeumGee Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Data and WooDeumGee Farm.
Diversification Opportunities for Lotte Data and WooDeumGee Farm
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lotte and WooDeumGee is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Data Communication and WooDeumGee Farm Co, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WooDeumGee Farm Co, 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 WooDeumGee Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WooDeumGee Farm Co, has no effect on the direction of Lotte Data i.e., Lotte Data and WooDeumGee Farm go up and down completely randomly.
Pair Corralation between Lotte Data and WooDeumGee Farm
Assuming the 90 days trading horizon Lotte Data Communication is expected to generate 0.92 times more return on investment than WooDeumGee Farm. However, Lotte Data Communication is 1.08 times less risky than WooDeumGee Farm. It trades about 0.24 of its potential returns per unit of risk. WooDeumGee Farm Co, is currently generating about 0.04 per unit of risk. If you would invest 1,954,000 in Lotte Data Communication on November 28, 2024 and sell it today you would earn a total of 106,000 from holding Lotte Data Communication or generate 5.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Lotte Data Communication vs. WooDeumGee Farm Co,
Performance |
| Timeline |
| Lotte Data Communication |
| WooDeumGee Farm Co, |
Lotte Data and WooDeumGee Farm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Data and WooDeumGee Farm
The main advantage of trading using opposite Lotte Data and WooDeumGee Farm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Data position performs unexpectedly, WooDeumGee Farm 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 WooDeumGee Farm will offset losses from the drop in WooDeumGee Farm's long position.| Lotte Data vs. Sangsin Energy Display | Lotte Data vs. Playgram Co | Lotte Data vs. Innowireless Co | Lotte Data vs. Daejung Chemicals Metals |
| WooDeumGee Farm vs. Hyosung Advanced Materials | WooDeumGee Farm vs. PI Advanced Materials | WooDeumGee Farm vs. Wonil Special Steel | WooDeumGee Farm vs. National Plastic 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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