Correlation Between Moadata and CKH Food
Can any of the company-specific risk be diversified away by investing in both Moadata and CKH Food 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 Moadata and CKH Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moadata Co and CKH Food Health, you can compare the effects of market volatilities on Moadata and CKH Food 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 Moadata with a short position of CKH Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moadata and CKH Food.
Diversification Opportunities for Moadata and CKH Food
Average diversification
The 3 months correlation between Moadata and CKH is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Moadata Co and CKH Food Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKH Food Health and Moadata 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 Moadata Co are associated (or correlated) with CKH Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKH Food Health has no effect on the direction of Moadata i.e., Moadata and CKH Food go up and down completely randomly.
Pair Corralation between Moadata and CKH Food
Assuming the 90 days trading horizon Moadata Co is expected to generate 1.75 times more return on investment than CKH Food. However, Moadata is 1.75 times more volatile than CKH Food Health. It trades about -0.07 of its potential returns per unit of risk. CKH Food Health is currently generating about -0.19 per unit of risk. If you would invest 163,000 in Moadata Co on August 29, 2024 and sell it today you would lose (9,500) from holding Moadata Co or give up 5.83% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Moadata Co vs. CKH Food Health
Performance |
Timeline |
Moadata |
CKH Food Health |
Moadata and CKH Food Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Moadata and CKH Food
The main advantage of trading using opposite Moadata and CKH Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moadata position performs unexpectedly, CKH Food 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 CKH Food will offset losses from the drop in CKH Food's long position.Moadata vs. Posco ICT | Moadata vs. Devsisters corporation | Moadata vs. Nice Information Telecommunication | Moadata vs. InfoBank |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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