Correlation Between Cots Technology and HYUNDAI BIOLAND
Can any of the company-specific risk be diversified away by investing in both Cots Technology and HYUNDAI BIOLAND 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 Cots Technology and HYUNDAI BIOLAND into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cots Technology Co and HYUNDAI BIOLAND CoLtd, you can compare the effects of market volatilities on Cots Technology and HYUNDAI BIOLAND 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 Cots Technology with a short position of HYUNDAI BIOLAND. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cots Technology and HYUNDAI BIOLAND.
Diversification Opportunities for Cots Technology and HYUNDAI BIOLAND
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cots and HYUNDAI is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Cots Technology Co and HYUNDAI BIOLAND CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYUNDAI BIOLAND CoLtd and Cots 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 Cots Technology Co are associated (or correlated) with HYUNDAI BIOLAND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYUNDAI BIOLAND CoLtd has no effect on the direction of Cots Technology i.e., Cots Technology and HYUNDAI BIOLAND go up and down completely randomly.
Pair Corralation between Cots Technology and HYUNDAI BIOLAND
Assuming the 90 days trading horizon Cots Technology Co is expected to under-perform the HYUNDAI BIOLAND. In addition to that, Cots Technology is 1.3 times more volatile than HYUNDAI BIOLAND CoLtd. It trades about -0.42 of its total potential returns per unit of risk. HYUNDAI BIOLAND CoLtd is currently generating about -0.11 per unit of volatility. If you would invest 465,000 in HYUNDAI BIOLAND CoLtd on September 12, 2024 and sell it today you would lose (39,500) from holding HYUNDAI BIOLAND CoLtd or give up 8.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cots Technology Co vs. HYUNDAI BIOLAND CoLtd
Performance |
| Timeline |
| Cots Technology |
| HYUNDAI BIOLAND CoLtd |
Cots Technology and HYUNDAI BIOLAND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cots Technology and HYUNDAI BIOLAND
The main advantage of trading using opposite Cots Technology and HYUNDAI BIOLAND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cots Technology position performs unexpectedly, HYUNDAI BIOLAND 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 HYUNDAI BIOLAND will offset losses from the drop in HYUNDAI BIOLAND's long position.| Cots Technology vs. Samsung Electronics Co | Cots Technology vs. Samsung Electronics Co | Cots Technology vs. LG Energy Solution | Cots Technology vs. SK Hynix |
| HYUNDAI BIOLAND vs. Korea New Network | HYUNDAI BIOLAND vs. ICD Co | HYUNDAI BIOLAND vs. DYPNF CoLtd | HYUNDAI BIOLAND vs. Solution Advanced Technology |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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