Correlation Between Kakao Games and Amogreentech
Can any of the company-specific risk be diversified away by investing in both Kakao Games and Amogreentech 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 Kakao Games and Amogreentech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kakao Games Corp and Amogreentech Co, you can compare the effects of market volatilities on Kakao Games and Amogreentech 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 Kakao Games with a short position of Amogreentech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kakao Games and Amogreentech.
Diversification Opportunities for Kakao Games and Amogreentech
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kakao and Amogreentech is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kakao Games Corp and Amogreentech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amogreentech and Kakao Games 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 Kakao Games Corp are associated (or correlated) with Amogreentech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amogreentech has no effect on the direction of Kakao Games i.e., Kakao Games and Amogreentech go up and down completely randomly.
Pair Corralation between Kakao Games and Amogreentech
Assuming the 90 days trading horizon Kakao Games Corp is expected to generate 0.81 times more return on investment than Amogreentech. However, Kakao Games Corp is 1.24 times less risky than Amogreentech. It trades about -0.07 of its potential returns per unit of risk. Amogreentech Co is currently generating about -0.08 per unit of risk. If you would invest 3,135,000 in Kakao Games Corp on August 28, 2024 and sell it today you would lose (1,432,000) from holding Kakao Games Corp or give up 45.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kakao Games Corp vs. Amogreentech Co
Performance |
| Timeline |
| Kakao Games Corp |
| Amogreentech |
Kakao Games and Amogreentech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kakao Games and Amogreentech
The main advantage of trading using opposite Kakao Games and Amogreentech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kakao Games position performs unexpectedly, Amogreentech 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 Amogreentech will offset losses from the drop in Amogreentech's long position.| Kakao Games vs. Posco ICT | Kakao Games vs. Devsisters corporation | Kakao Games vs. Nice Information Telecommunication | Kakao Games vs. InfoBank |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |