Correlation Between IL Science and Kuk Young
Can any of the company-specific risk be diversified away by investing in both IL Science and Kuk Young 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 IL Science and Kuk Young into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IL Science Co and Kuk Young GM, you can compare the effects of market volatilities on IL Science and Kuk Young 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 IL Science with a short position of Kuk Young. Check out your portfolio center. Please also check ongoing floating volatility patterns of IL Science and Kuk Young.
Diversification Opportunities for IL Science and Kuk Young
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 307180 and Kuk is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding IL Science Co and Kuk Young GM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuk Young GM and IL Science 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 IL Science Co are associated (or correlated) with Kuk Young. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuk Young GM has no effect on the direction of IL Science i.e., IL Science and Kuk Young go up and down completely randomly.
Pair Corralation between IL Science and Kuk Young
Assuming the 90 days trading horizon IL Science Co is expected to under-perform the Kuk Young. But the stock apears to be less risky and, when comparing its historical volatility, IL Science Co is 1.05 times less risky than Kuk Young. The stock trades about -0.01 of its potential returns per unit of risk. The Kuk Young GM is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 140,900 in Kuk Young GM on August 29, 2024 and sell it today you would earn a total of 42,500 from holding Kuk Young GM or generate 30.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
IL Science Co vs. Kuk Young GM
Performance |
| Timeline |
| IL Science |
| Kuk Young GM |
IL Science and Kuk Young Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IL Science and Kuk Young
The main advantage of trading using opposite IL Science and Kuk Young positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IL Science position performs unexpectedly, Kuk Young 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 Kuk Young will offset losses from the drop in Kuk Young's long position.| IL Science vs. Songwon Industrial Co | IL Science vs. Hyundai Engineering Plastics | IL Science vs. Tway Air Co | IL Science vs. Kbi Metal Co |
| Kuk Young vs. KakaoBank Corp | Kuk Young vs. Jeju Bank | Kuk Young vs. Automobile Pc | Kuk Young vs. Dongbu Insurance Co |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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