Correlation Between CKH Food and Innometry
Can any of the company-specific risk be diversified away by investing in both CKH Food and Innometry 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 Innometry 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 Innometry Co, you can compare the effects of market volatilities on CKH Food and Innometry 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 Innometry. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKH Food and Innometry.
Diversification Opportunities for CKH Food and Innometry
Almost no diversification
The 3 months correlation between CKH and Innometry is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding CKH Food Health and Innometry Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innometry 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 Innometry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innometry has no effect on the direction of CKH Food i.e., CKH Food and Innometry go up and down completely randomly.
Pair Corralation between CKH Food and Innometry
Assuming the 90 days trading horizon CKH Food Health is expected to under-perform the Innometry. In addition to that, CKH Food is 1.49 times more volatile than Innometry Co. It trades about -0.08 of its total potential returns per unit of risk. Innometry Co is currently generating about -0.01 per unit of volatility. If you would invest 752,000 in Innometry Co on October 24, 2024 and sell it today you would lose (5,000) from holding Innometry Co or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CKH Food Health vs. Innometry Co
Performance |
| Timeline |
| CKH Food Health |
| Innometry |
CKH Food and Innometry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CKH Food and Innometry
The main advantage of trading using opposite CKH Food and Innometry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKH Food position performs unexpectedly, Innometry 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 Innometry will offset losses from the drop in Innometry's long position.| CKH Food vs. UJU Electronics Co | CKH Food vs. Stic Investments | CKH Food vs. Sungmoon Electronics Co | CKH Food vs. Shinil Electronics Co |
| Innometry vs. Korea Investment Holdings | Innometry vs. CKH Food Health | Innometry vs. Atinum Investment Co | Innometry vs. Daelim Trading 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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