Correlation Between Kakao Games and ASTORY CoLtd
Can any of the company-specific risk be diversified away by investing in both Kakao Games and ASTORY CoLtd 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 ASTORY CoLtd 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 ASTORY CoLtd, you can compare the effects of market volatilities on Kakao Games and ASTORY CoLtd 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 ASTORY CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kakao Games and ASTORY CoLtd.
Diversification Opportunities for Kakao Games and ASTORY CoLtd
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kakao and ASTORY is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Kakao Games Corp and ASTORY CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTORY CoLtd 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 ASTORY CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTORY CoLtd has no effect on the direction of Kakao Games i.e., Kakao Games and ASTORY CoLtd go up and down completely randomly.
Pair Corralation between Kakao Games and ASTORY CoLtd
Assuming the 90 days trading horizon Kakao Games Corp is expected to generate 0.93 times more return on investment than ASTORY CoLtd. However, Kakao Games Corp is 1.08 times less risky than ASTORY CoLtd. It trades about -0.08 of its potential returns per unit of risk. ASTORY CoLtd is currently generating about -0.09 per unit of risk. If you would invest 3,965,000 in Kakao Games Corp on September 4, 2024 and sell it today you would lose (2,068,000) from holding Kakao Games Corp or give up 52.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kakao Games Corp vs. ASTORY CoLtd
Performance |
| Timeline |
| Kakao Games Corp |
| ASTORY CoLtd |
Kakao Games and ASTORY CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kakao Games and ASTORY CoLtd
The main advantage of trading using opposite Kakao Games and ASTORY CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kakao Games position performs unexpectedly, ASTORY CoLtd 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 ASTORY CoLtd will offset losses from the drop in ASTORY CoLtd's long position.| Kakao Games vs. Posco ICT | Kakao Games vs. Devsisters corporation | Kakao Games vs. Alchera | Kakao Games vs. Nice Information Telecommunication |
| ASTORY CoLtd vs. BNK Financial Group | ASTORY CoLtd vs. Daehan Synthetic Fiber | ASTORY CoLtd vs. SH Energy Chemical | ASTORY CoLtd vs. Miwon Chemical |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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