Correlation Between Foodnamoo and Naver
Can any of the company-specific risk be diversified away by investing in both Foodnamoo and Naver 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 Naver into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Foodnamoo and Naver, you can compare the effects of market volatilities on Foodnamoo and Naver 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 Naver. Check out your portfolio center. Please also check ongoing floating volatility patterns of Foodnamoo and Naver.
Diversification Opportunities for Foodnamoo and Naver
Excellent diversification
The 3 months correlation between Foodnamoo and Naver is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Foodnamoo and Naver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Naver 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 Naver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Naver has no effect on the direction of Foodnamoo i.e., Foodnamoo and Naver go up and down completely randomly.
Pair Corralation between Foodnamoo and Naver
Assuming the 90 days trading horizon Foodnamoo is expected to under-perform the Naver. In addition to that, Foodnamoo is 2.14 times more volatile than Naver. It trades about -0.01 of its total potential returns per unit of risk. Naver is currently generating about 0.23 per unit of volatility. If you would invest 16,060,000 in Naver on September 19, 2024 and sell it today you would earn a total of 4,890,000 from holding Naver or generate 30.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Foodnamoo vs. Naver
Performance |
| Timeline |
| Foodnamoo |
| Naver |
Foodnamoo and Naver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Foodnamoo and Naver
The main advantage of trading using opposite Foodnamoo and Naver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Foodnamoo position performs unexpectedly, Naver 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 Naver will offset losses from the drop in Naver's long position.| Foodnamoo vs. Solution Advanced Technology | Foodnamoo vs. Busan Industrial Co | Foodnamoo vs. Busan Ind | Foodnamoo vs. Sam Chun Dang |
| Naver vs. Foodnamoo | Naver vs. Hyundai Green Food | Naver vs. Pureun Mutual Savings | Naver vs. CKH Food Health |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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