Correlation Between Kelt Exploration and POSCO Holdings
Can any of the company-specific risk be diversified away by investing in both Kelt Exploration and POSCO Holdings 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 Kelt Exploration and POSCO Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kelt Exploration and POSCO Holdings, you can compare the effects of market volatilities on Kelt Exploration and POSCO Holdings 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 Kelt Exploration with a short position of POSCO Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kelt Exploration and POSCO Holdings.
Diversification Opportunities for Kelt Exploration and POSCO Holdings
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kelt and POSCO is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kelt Exploration and POSCO Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POSCO Holdings and Kelt Exploration 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 Kelt Exploration are associated (or correlated) with POSCO Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POSCO Holdings has no effect on the direction of Kelt Exploration i.e., Kelt Exploration and POSCO Holdings go up and down completely randomly.
Pair Corralation between Kelt Exploration and POSCO Holdings
Assuming the 90 days horizon Kelt Exploration is expected to generate 0.96 times more return on investment than POSCO Holdings. However, Kelt Exploration is 1.05 times less risky than POSCO Holdings. It trades about 0.0 of its potential returns per unit of risk. POSCO Holdings is currently generating about -0.08 per unit of risk. If you would invest 505.00 in Kelt Exploration on September 12, 2024 and sell it today you would lose (51.00) from holding Kelt Exploration or give up 10.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.7% |
| Values | Daily Returns |
Kelt Exploration vs. POSCO Holdings
Performance |
| Timeline |
| Kelt Exploration |
| POSCO Holdings |
Kelt Exploration and POSCO Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kelt Exploration and POSCO Holdings
The main advantage of trading using opposite Kelt Exploration and POSCO Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kelt Exploration position performs unexpectedly, POSCO Holdings 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 POSCO Holdings will offset losses from the drop in POSCO Holdings' long position.| Kelt Exploration vs. POSCO Holdings | Kelt Exploration vs. Schweizerische Nationalbank | Kelt Exploration vs. Berkshire Hathaway | Kelt Exploration vs. Berkshire Hathaway |
| POSCO Holdings vs. Olympic Steel | POSCO Holdings vs. Universal Stainless Alloy | POSCO Holdings vs. Outokumpu Oyj ADR | POSCO Holdings vs. Ternium SA ADR |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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