Correlation Between Air Busan and Wonil Special
Can any of the company-specific risk be diversified away by investing in both Air Busan and Wonil Special 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 Air Busan and Wonil Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Busan Co and Wonil Special Steel, you can compare the effects of market volatilities on Air Busan and Wonil Special 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 Air Busan with a short position of Wonil Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Busan and Wonil Special.
Diversification Opportunities for Air Busan and Wonil Special
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Air and Wonil is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Air Busan Co and Wonil Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonil Special Steel and Air Busan 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 Air Busan Co are associated (or correlated) with Wonil Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonil Special Steel has no effect on the direction of Air Busan i.e., Air Busan and Wonil Special go up and down completely randomly.
Pair Corralation between Air Busan and Wonil Special
Assuming the 90 days trading horizon Air Busan Co is expected to under-perform the Wonil Special. In addition to that, Air Busan is 1.71 times more volatile than Wonil Special Steel. It trades about -0.24 of its total potential returns per unit of risk. Wonil Special Steel is currently generating about -0.06 per unit of volatility. If you would invest 724,000 in Wonil Special Steel on November 27, 2024 and sell it today you would lose (5,000) from holding Wonil Special Steel or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Busan Co vs. Wonil Special Steel
Performance |
| Timeline |
| Air Busan |
| Wonil Special Steel |
Air Busan and Wonil Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Busan and Wonil Special
The main advantage of trading using opposite Air Busan and Wonil Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Busan position performs unexpectedly, Wonil Special 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 Wonil Special will offset losses from the drop in Wonil Special's long position.| Air Busan vs. Formetal Co | Air Busan vs. Industrial Bank | Air Busan vs. Sungmoon Electronics Co | Air Busan vs. Hyundai Industrial Co |
| Wonil Special vs. Tuksu Engineering ConstructionLtd | Wonil Special vs. Dongbang Ship Machinery | Wonil Special vs. Shinhan Inverse Silver | Wonil Special vs. INSUN Environmental New |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |