Correlation Between GungHo Online and ADHI KARYA
Can any of the company-specific risk be diversified away by investing in both GungHo Online and ADHI KARYA 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 ADHI KARYA 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 ADHI KARYA, you can compare the effects of market volatilities on GungHo Online and ADHI KARYA 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 ADHI KARYA. Check out your portfolio center. Please also check ongoing floating volatility patterns of GungHo Online and ADHI KARYA.
Diversification Opportunities for GungHo Online and ADHI KARYA
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between GungHo and ADHI is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding GungHo Online Entertainment and ADHI KARYA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADHI KARYA 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 ADHI KARYA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADHI KARYA has no effect on the direction of GungHo Online i.e., GungHo Online and ADHI KARYA go up and down completely randomly.
Pair Corralation between GungHo Online and ADHI KARYA
Assuming the 90 days horizon GungHo Online is expected to generate 70.69 times less return on investment than ADHI KARYA. But when comparing it to its historical volatility, GungHo Online Entertainment is 43.35 times less risky than ADHI KARYA. It trades about 0.06 of its potential returns per unit of risk. ADHI KARYA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 0.55 in ADHI KARYA on September 3, 2024 and sell it today you would earn a total of 0.60 from holding ADHI KARYA or generate 109.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GungHo Online Entertainment vs. ADHI KARYA
Performance |
| Timeline |
| GungHo Online Entert |
| ADHI KARYA |
GungHo Online and ADHI KARYA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GungHo Online and ADHI KARYA
The main advantage of trading using opposite GungHo Online and ADHI KARYA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GungHo Online position performs unexpectedly, ADHI KARYA 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 ADHI KARYA will offset losses from the drop in ADHI KARYA's long position.| GungHo Online vs. JIAHUA STORES | GungHo Online vs. FUYO GENERAL LEASE | GungHo Online vs. THORNEY TECHS LTD | GungHo Online vs. QURATE RETAIL INC |
| ADHI KARYA vs. Cogent Communications Holdings | ADHI KARYA vs. Canon Marketing Japan | ADHI KARYA vs. Chunghwa Telecom Co | ADHI KARYA vs. RETAIL FOOD GROUP |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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