Correlation Between RF Materials and Imarketkorea
Can any of the company-specific risk be diversified away by investing in both RF Materials and Imarketkorea 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 RF Materials and Imarketkorea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between RF Materials Co and Imarketkorea, you can compare the effects of market volatilities on RF Materials and Imarketkorea 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 RF Materials with a short position of Imarketkorea. Check out your portfolio center. Please also check ongoing floating volatility patterns of RF Materials and Imarketkorea.
Diversification Opportunities for RF Materials and Imarketkorea
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 327260 and Imarketkorea is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding RF Materials Co and Imarketkorea in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imarketkorea and RF Materials 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 RF Materials Co are associated (or correlated) with Imarketkorea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imarketkorea has no effect on the direction of RF Materials i.e., RF Materials and Imarketkorea go up and down completely randomly.
Pair Corralation between RF Materials and Imarketkorea
Assuming the 90 days trading horizon RF Materials Co is expected to under-perform the Imarketkorea. In addition to that, RF Materials is 4.65 times more volatile than Imarketkorea. It trades about -0.14 of its total potential returns per unit of risk. Imarketkorea is currently generating about 0.0 per unit of volatility. If you would invest 838,257 in Imarketkorea on September 3, 2024 and sell it today you would lose (4,257) from holding Imarketkorea or give up 0.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
RF Materials Co vs. Imarketkorea
Performance |
| Timeline |
| RF Materials |
| Imarketkorea |
RF Materials and Imarketkorea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RF Materials and Imarketkorea
The main advantage of trading using opposite RF Materials and Imarketkorea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RF Materials position performs unexpectedly, Imarketkorea 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 Imarketkorea will offset losses from the drop in Imarketkorea's long position.| RF Materials vs. SK Hynix | RF Materials vs. LX Semicon Co | RF Materials vs. Tokai Carbon Korea | RF Materials vs. People Technology |
| Imarketkorea vs. PLAYWITH | Imarketkorea vs. Sangsin Energy Display | Imarketkorea vs. Korea Alcohol Industrial | Imarketkorea vs. DB 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |