Correlation Between GungHo Online and WINMARK
Can any of the company-specific risk be diversified away by investing in both GungHo Online and WINMARK 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 GungHo Online and WINMARK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GungHo Online Entertainment and WINMARK, you can compare the effects of market volatilities on GungHo Online and WINMARK 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 GungHo Online with a short position of WINMARK. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and WINMARK.
Diversification Opportunities for GungHo Online and WINMARK
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between GungHo and WINMARK is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and WINMARK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WINMARK and GungHo Online 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 GungHo Online Entertainment are associated (or correlated) with WINMARK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WINMARK has no effect on the direction of GungHo Online i.e., GungHo Online and WINMARK go up and down completely randomly.
Pair Corralation between GungHo Online and WINMARK
Assuming the 90 days horizon GungHo Online Entertainment is expected to generate 1.26 times more return on investment than WINMARK. However, GungHo Online is 1.26 times more volatile than WINMARK. It trades about 0.06 of its potential returns per unit of risk. WINMARK is currently generating about 0.01 per unit of risk. If you would invest 1,410 in GungHo Online Entertainment on September 12, 2024 and sell it today you would earn a total of 450.00 from holding GungHo Online Entertainment or generate 31.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
GungHo Online Entertainment vs. WINMARK
Performance |
| Timeline |
| GungHo Online Entert |
| WINMARK |
GungHo Online and WINMARK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and WINMARK
The main advantage of trading using opposite GungHo Online and WINMARK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, WINMARK 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 WINMARK will offset losses from the drop in WINMARK's long position.| GungHo Online vs. Infrastrutture Wireless Italiane | GungHo Online vs. CENTURIA OFFICE REIT | GungHo Online vs. MAVEN WIRELESS SWEDEN | GungHo Online vs. CITY OFFICE REIT |
| WINMARK vs. Citic Telecom International | WINMARK vs. Comba Telecom Systems | WINMARK vs. Chunghwa Telecom Co | WINMARK vs. Verizon Communications |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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