Correlation Between CU Tech and Kakaopay Corp
Can any of the company-specific risk be diversified away by investing in both CU Tech and Kakaopay Corp 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 CU Tech and Kakaopay Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CU Tech Corp and kakaopay Corp, you can compare the effects of market volatilities on CU Tech and Kakaopay Corp 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 CU Tech with a short position of Kakaopay Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of CU Tech and Kakaopay Corp.
Diversification Opportunities for CU Tech and Kakaopay Corp
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 376290 and Kakaopay is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding CU Tech Corp and kakaopay Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on kakaopay Corp and CU Tech 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 CU Tech Corp are associated (or correlated) with Kakaopay Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of kakaopay Corp has no effect on the direction of CU Tech i.e., CU Tech and Kakaopay Corp go up and down completely randomly.
Pair Corralation between CU Tech and Kakaopay Corp
Assuming the 90 days trading horizon CU Tech Corp is expected to generate 0.57 times more return on investment than Kakaopay Corp. However, CU Tech Corp is 1.74 times less risky than Kakaopay Corp. It trades about 0.1 of its potential returns per unit of risk. kakaopay Corp is currently generating about 0.04 per unit of risk. If you would invest 295,000 in CU Tech Corp on October 20, 2024 and sell it today you would earn a total of 6,000 from holding CU Tech Corp or generate 2.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
CU Tech Corp vs. kakaopay Corp
Performance |
| Timeline |
| CU Tech Corp |
| kakaopay Corp |
CU Tech and Kakaopay Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CU Tech and Kakaopay Corp
The main advantage of trading using opposite CU Tech and Kakaopay Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CU Tech position performs unexpectedly, Kakaopay Corp 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 Kakaopay Corp will offset losses from the drop in Kakaopay Corp's long position.| CU Tech vs. Pureun Mutual Savings | CU Tech vs. Digital Imaging Technology | CU Tech vs. Woori Financial Group | CU Tech vs. InfoBank |
| Kakaopay Corp vs. Samsung Electronics Co | Kakaopay Corp vs. Samsung Electronics Co | Kakaopay Corp vs. LG Energy Solution | Kakaopay Corp vs. SK Hynix |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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