Correlation Between WOORI FIN and Public Service
Can any of the company-specific risk be diversified away by investing in both WOORI FIN and Public Service 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 WOORI FIN and Public Service into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WOORI FIN GRP and Public Service Enterprise, you can compare the effects of market volatilities on WOORI FIN and Public Service 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 WOORI FIN with a short position of Public Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of WOORI FIN and Public Service.
Diversification Opportunities for WOORI FIN and Public Service
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WOORI and Public is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding WOORI FIN GRP and Public Service Enterprise in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Service Enterprise and WOORI FIN 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 WOORI FIN GRP are associated (or correlated) with Public Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Service Enterprise has no effect on the direction of WOORI FIN i.e., WOORI FIN and Public Service go up and down completely randomly.
Pair Corralation between WOORI FIN and Public Service
Assuming the 90 days trading horizon WOORI FIN is expected to generate 24.6 times less return on investment than Public Service. In addition to that, WOORI FIN is 1.72 times more volatile than Public Service Enterprise. It trades about 0.01 of its total potential returns per unit of risk. Public Service Enterprise is currently generating about 0.25 per unit of volatility. If you would invest 1,650 in Public Service Enterprise on October 23, 2024 and sell it today you would earn a total of 50.00 from holding Public Service Enterprise or generate 3.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WOORI FIN GRP vs. Public Service Enterprise
Performance |
| Timeline |
| WOORI FIN GRP |
| Public Service Enterprise |
WOORI FIN and Public Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WOORI FIN and Public Service
The main advantage of trading using opposite WOORI FIN and Public Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WOORI FIN position performs unexpectedly, Public Service 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 Public Service will offset losses from the drop in Public Service's long position.| WOORI FIN vs. Gladstone Investment | WOORI FIN vs. MidCap Financial Investment | WOORI FIN vs. Guangdong Investment Limited | WOORI FIN vs. Global Ship Lease |
| Public Service vs. Zoom Video Communications | Public Service vs. Geely Automobile Holdings | Public Service vs. INTERSHOP Communications Aktiengesellschaft | Public Service vs. WillScot Mobile Mini |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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