Correlation Between Raontech and Nature
Can any of the company-specific risk be diversified away by investing in both Raontech and Nature 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 Raontech and Nature into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raontech and Nature and Environment, you can compare the effects of market volatilities on Raontech and Nature 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 Raontech with a short position of Nature. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raontech and Nature.
Diversification Opportunities for Raontech and Nature
Very weak diversification
The 3 months correlation between Raontech and Nature is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Raontech and Nature and Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nature and Environment and Raontech 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 Raontech are associated (or correlated) with Nature. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nature and Environment has no effect on the direction of Raontech i.e., Raontech and Nature go up and down completely randomly.
Pair Corralation between Raontech and Nature
Assuming the 90 days trading horizon Raontech is expected to generate 2.87 times more return on investment than Nature. However, Raontech is 2.87 times more volatile than Nature and Environment. It trades about 0.18 of its potential returns per unit of risk. Nature and Environment is currently generating about -0.19 per unit of risk. If you would invest 314,000 in Raontech on October 17, 2024 and sell it today you would earn a total of 44,000 from holding Raontech or generate 14.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Raontech vs. Nature and Environment
Performance |
| Timeline |
| Raontech |
| Nature and Environment |
Raontech and Nature Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raontech and Nature
The main advantage of trading using opposite Raontech and Nature positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raontech position performs unexpectedly, Nature 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 Nature will offset losses from the drop in Nature's long position.| Raontech vs. Sam Yang Foods | Raontech vs. Woorim Machinery Co | Raontech vs. Keyang Electric Machinery | Raontech vs. Samyang Foods Co |
| Nature vs. Hwangkum Steel Technology | Nature vs. Orbitech Co | Nature vs. Raontech | Nature vs. CU Tech Corp |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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