Correlation Between GungHo Online and KINGBOARD CHEMICAL
Can any of the company-specific risk be diversified away by investing in both GungHo Online and KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL, you can compare the effects of market volatilities on GungHo Online and KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and KINGBOARD CHEMICAL.
Diversification Opportunities for GungHo Online and KINGBOARD CHEMICAL
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between GungHo and KINGBOARD is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and KINGBOARD CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KINGBOARD CHEMICAL has no effect on the direction of GungHo Online i.e., GungHo Online and KINGBOARD CHEMICAL go up and down completely randomly.
Pair Corralation between GungHo Online and KINGBOARD CHEMICAL
Assuming the 90 days horizon GungHo Online Entertainment is expected to under-perform the KINGBOARD CHEMICAL. In addition to that, GungHo Online is 1.36 times more volatile than KINGBOARD CHEMICAL. It trades about -0.05 of its total potential returns per unit of risk. KINGBOARD CHEMICAL is currently generating about 0.03 per unit of volatility. If you would invest 234.00 in KINGBOARD CHEMICAL on September 12, 2024 and sell it today you would earn a total of 2.00 from holding KINGBOARD CHEMICAL or generate 0.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. KINGBOARD CHEMICAL
Performance |
| Timeline |
| GungHo Online Entert |
| KINGBOARD CHEMICAL |
GungHo Online and KINGBOARD CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and KINGBOARD CHEMICAL
The main advantage of trading using opposite GungHo Online and KINGBOARD CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL will offset losses from the drop in KINGBOARD CHEMICAL's long position.| GungHo Online vs. NEXON Co | GungHo Online vs. Take Two Interactive Software | GungHo Online vs. Superior Plus Corp | GungHo Online vs. SIVERS SEMICONDUCTORS AB |
| KINGBOARD CHEMICAL vs. Apple Inc | KINGBOARD CHEMICAL vs. Apple Inc | KINGBOARD CHEMICAL vs. Apple Inc | KINGBOARD CHEMICAL vs. Apple Inc |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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