Correlation Between Prestige Biologics and Youngsin Metal
Can any of the company-specific risk be diversified away by investing in both Prestige Biologics and Youngsin Metal 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 Prestige Biologics and Youngsin Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prestige Biologics Co and Youngsin Metal Industrial, you can compare the effects of market volatilities on Prestige Biologics and Youngsin Metal 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 Prestige Biologics with a short position of Youngsin Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prestige Biologics and Youngsin Metal.
Diversification Opportunities for Prestige Biologics and Youngsin Metal
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Prestige and Youngsin is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Prestige Biologics Co and Youngsin Metal Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngsin Metal Industrial and Prestige Biologics 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 Prestige Biologics Co are associated (or correlated) with Youngsin Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngsin Metal Industrial has no effect on the direction of Prestige Biologics i.e., Prestige Biologics and Youngsin Metal go up and down completely randomly.
Pair Corralation between Prestige Biologics and Youngsin Metal
Assuming the 90 days trading horizon Prestige Biologics Co is expected to generate 2.01 times more return on investment than Youngsin Metal. However, Prestige Biologics is 2.01 times more volatile than Youngsin Metal Industrial. It trades about 0.04 of its potential returns per unit of risk. Youngsin Metal Industrial is currently generating about -0.05 per unit of risk. If you would invest 468,000 in Prestige Biologics Co on September 4, 2024 and sell it today you would earn a total of 81,000 from holding Prestige Biologics Co or generate 17.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prestige Biologics Co vs. Youngsin Metal Industrial
Performance |
| Timeline |
| Prestige Biologics |
| Youngsin Metal Industrial |
Prestige Biologics and Youngsin Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prestige Biologics and Youngsin Metal
The main advantage of trading using opposite Prestige Biologics and Youngsin Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prestige Biologics position performs unexpectedly, Youngsin Metal 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 Youngsin Metal will offset losses from the drop in Youngsin Metal's long position.| Prestige Biologics vs. Youngsin Metal Industrial | Prestige Biologics vs. Hyundai Industrial Co | Prestige Biologics vs. Hyunwoo Industrial Co | Prestige Biologics vs. Kyeryong Construction Industrial |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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