Correlation Between CKH Food and CJ Seafood
Can any of the company-specific risk be diversified away by investing in both CKH Food and CJ Seafood 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 CKH Food and CJ Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CKH Food Health and CJ Seafood Corp, you can compare the effects of market volatilities on CKH Food and CJ Seafood 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 CKH Food with a short position of CJ Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKH Food and CJ Seafood.
Diversification Opportunities for CKH Food and CJ Seafood
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CKH and 011155 is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding CKH Food Health and CJ Seafood Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ Seafood Corp and CKH Food 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 CKH Food Health are associated (or correlated) with CJ Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ Seafood Corp has no effect on the direction of CKH Food i.e., CKH Food and CJ Seafood go up and down completely randomly.
Pair Corralation between CKH Food and CJ Seafood
Assuming the 90 days trading horizon CKH Food Health is expected to under-perform the CJ Seafood. In addition to that, CKH Food is 2.58 times more volatile than CJ Seafood Corp. It trades about -0.1 of its total potential returns per unit of risk. CJ Seafood Corp is currently generating about -0.12 per unit of volatility. If you would invest 1,782,000 in CJ Seafood Corp on August 27, 2024 and sell it today you would lose (119,000) from holding CJ Seafood Corp or give up 6.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CKH Food Health vs. CJ Seafood Corp
Performance |
| Timeline |
| CKH Food Health |
| CJ Seafood Corp |
CKH Food and CJ Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CKH Food and CJ Seafood
The main advantage of trading using opposite CKH Food and CJ Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKH Food position performs unexpectedly, CJ Seafood 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 CJ Seafood will offset losses from the drop in CJ Seafood's long position.| CKH Food vs. AptaBio Therapeutics | CKH Food vs. Daewoo SBI SPAC | CKH Food vs. Dream Security co | CKH Food vs. Microfriend |
| CJ Seafood vs. Busan Industrial Co | CJ Seafood vs. Busan Ind | CJ Seafood vs. Mirae Asset Daewoo | CJ Seafood vs. UNISEM 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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