Correlation Between Konan Technology and Woori Technology
Can any of the company-specific risk be diversified away by investing in both Konan Technology and Woori Technology 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 Konan Technology and Woori Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Konan Technology and Woori Technology, you can compare the effects of market volatilities on Konan Technology and Woori Technology 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 Konan Technology with a short position of Woori Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konan Technology and Woori Technology.
Diversification Opportunities for Konan Technology and Woori Technology
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Konan and Woori is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Konan Technology and Woori Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Woori Technology and Konan Technology 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 Konan Technology are associated (or correlated) with Woori Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Woori Technology has no effect on the direction of Konan Technology i.e., Konan Technology and Woori Technology go up and down completely randomly.
Pair Corralation between Konan Technology and Woori Technology
Assuming the 90 days trading horizon Konan Technology is expected to generate 1.53 times more return on investment than Woori Technology. However, Konan Technology is 1.53 times more volatile than Woori Technology. It trades about 0.06 of its potential returns per unit of risk. Woori Technology is currently generating about 0.05 per unit of risk. If you would invest 950,000 in Konan Technology on August 29, 2024 and sell it today you would earn a total of 1,580,000 from holding Konan Technology or generate 166.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Konan Technology vs. Woori Technology
Performance |
| Timeline |
| Konan Technology |
| Woori Technology |
Konan Technology and Woori Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Konan Technology and Woori Technology
The main advantage of trading using opposite Konan Technology and Woori Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konan Technology position performs unexpectedly, Woori Technology 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 Woori Technology will offset losses from the drop in Woori Technology's long position.| Konan Technology vs. Posco ICT | Konan Technology vs. Devsisters corporation | Konan Technology vs. Nice Information Telecommunication | Konan Technology vs. InfoBank |
| Woori Technology vs. Korea Real Estate | Woori Technology vs. Korea Ratings Co | Woori Technology vs. IQuest Co | Woori Technology vs. Wonbang Tech 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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