Correlation Between FoodNamoo and Insung Information
Can any of the company-specific risk be diversified away by investing in both FoodNamoo and Insung Information 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 FoodNamoo and Insung Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FoodNamoo and Insung Information Co, you can compare the effects of market volatilities on FoodNamoo and Insung Information 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 FoodNamoo with a short position of Insung Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of FoodNamoo and Insung Information.
Diversification Opportunities for FoodNamoo and Insung Information
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between FoodNamoo and Insung is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding FoodNamoo and Insung Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insung Information and FoodNamoo 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 FoodNamoo are associated (or correlated) with Insung Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insung Information has no effect on the direction of FoodNamoo i.e., FoodNamoo and Insung Information go up and down completely randomly.
Pair Corralation between FoodNamoo and Insung Information
Assuming the 90 days trading horizon FoodNamoo is expected to under-perform the Insung Information. But the stock apears to be less risky and, when comparing its historical volatility, FoodNamoo is 1.67 times less risky than Insung Information. The stock trades about -0.37 of its potential returns per unit of risk. The Insung Information Co is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 174,800 in Insung Information Co on October 28, 2024 and sell it today you would earn a total of 13,500 from holding Insung Information Co or generate 7.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FoodNamoo vs. Insung Information Co
Performance |
| Timeline |
| FoodNamoo |
| Insung Information |
FoodNamoo and Insung Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FoodNamoo and Insung Information
The main advantage of trading using opposite FoodNamoo and Insung Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FoodNamoo position performs unexpectedly, Insung Information 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 Insung Information will offset losses from the drop in Insung Information's long position.| FoodNamoo vs. Organic Special Pet | FoodNamoo vs. Hyundai Engineering Plastics | FoodNamoo vs. Foodnamoo | FoodNamoo vs. Sempio Foods Co |
| Insung Information vs. Namhae Chemical | Insung Information vs. N2Tech Co | Insung Information vs. Wireless Power Amplifier | Insung Information vs. iNtRON Biotechnology |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |