Correlation Between Kosdaq Composite and Kg Chemical
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By analyzing existing cross correlation between Kosdaq Composite Index and Kg Chemical, you can compare the effects of market volatilities on Kosdaq Composite and Kg 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 Kosdaq Composite with a short position of Kg Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and Kg Chemical.
Diversification Opportunities for Kosdaq Composite and Kg Chemical
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kosdaq and 001390 is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and Kg Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kg Chemical and Kosdaq Composite 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 Kosdaq Composite Index are associated (or correlated) with Kg Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kg Chemical has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and Kg Chemical go up and down completely randomly.
Pair Corralation between Kosdaq Composite and Kg Chemical
Assuming the 90 days trading horizon Kosdaq Composite is expected to generate 4.02 times less return on investment than Kg Chemical. But when comparing it to its historical volatility, Kosdaq Composite Index is 2.52 times less risky than Kg Chemical. It trades about 0.01 of its potential returns per unit of risk. Kg Chemical is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 427,859 in Kg Chemical on October 11, 2024 and sell it today you would lose (43,859) from holding Kg Chemical or give up 10.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.58% |
| Values | Daily Returns |
Kosdaq Composite Index vs. Kg Chemical
Performance |
| Timeline |
Kosdaq Composite and Kg Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
Kg Chemical
Pair trading matchups for Kg Chemical
Pair Trading with Kosdaq Composite and Kg Chemical
The main advantage of trading using opposite Kosdaq Composite and Kg Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, Kg 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 Kg Chemical will offset losses from the drop in Kg Chemical's long position.| Kosdaq Composite vs. Nam Hwa Construction | Kosdaq Composite vs. Seohee Construction Co | Kosdaq Composite vs. Alton Sports CoLtd | Kosdaq Composite vs. Tamul Multimedia Co |
| Kg Chemical vs. INNOX Advanced Materials | Kg Chemical vs. Sempio Foods Co | Kg Chemical vs. RF Materials Co | Kg Chemical vs. Ssangyong Materials Corp |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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