Correlation Between Sk Biopharmaceutica and JNK Heaters
Can any of the company-specific risk be diversified away by investing in both Sk Biopharmaceutica and JNK Heaters 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 Sk Biopharmaceutica and JNK Heaters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sk Biopharmaceuticals Co and JNK Heaters Co, you can compare the effects of market volatilities on Sk Biopharmaceutica and JNK Heaters 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 Sk Biopharmaceutica with a short position of JNK Heaters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sk Biopharmaceutica and JNK Heaters.
Diversification Opportunities for Sk Biopharmaceutica and JNK Heaters
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 326030 and JNK is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Sk Biopharmaceuticals Co and JNK Heaters Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JNK Heaters and Sk Biopharmaceutica 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 Sk Biopharmaceuticals Co are associated (or correlated) with JNK Heaters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JNK Heaters has no effect on the direction of Sk Biopharmaceutica i.e., Sk Biopharmaceutica and JNK Heaters go up and down completely randomly.
Pair Corralation between Sk Biopharmaceutica and JNK Heaters
Assuming the 90 days trading horizon Sk Biopharmaceuticals Co is expected to generate 1.08 times more return on investment than JNK Heaters. However, Sk Biopharmaceutica is 1.08 times more volatile than JNK Heaters Co. It trades about 0.05 of its potential returns per unit of risk. JNK Heaters Co is currently generating about -0.02 per unit of risk. If you would invest 7,240,000 in Sk Biopharmaceuticals Co on October 9, 2024 and sell it today you would earn a total of 3,800,000 from holding Sk Biopharmaceuticals Co or generate 52.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sk Biopharmaceuticals Co vs. JNK Heaters Co
Performance |
| Timeline |
| Sk Biopharmaceuticals |
| JNK Heaters |
Sk Biopharmaceutica and JNK Heaters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sk Biopharmaceutica and JNK Heaters
The main advantage of trading using opposite Sk Biopharmaceutica and JNK Heaters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sk Biopharmaceutica position performs unexpectedly, JNK Heaters 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 JNK Heaters will offset losses from the drop in JNK Heaters' long position.| Sk Biopharmaceutica vs. SKONEC Entertainment Co | Sk Biopharmaceutica vs. Next Entertainment World | Sk Biopharmaceutica vs. Cube Entertainment | Sk Biopharmaceutica vs. Dongbang Transport Logistics |
| JNK Heaters vs. KIWI Media Group | JNK Heaters vs. Digital Multimedia Technology | JNK Heaters vs. ITM Semiconductor Co | JNK Heaters vs. Jeju Air 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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