Correlation Between Kosdaq Composite and COWAY
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By analyzing existing cross correlation between Kosdaq Composite Index and COWAY Co, you can compare the effects of market volatilities on Kosdaq Composite and COWAY 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 COWAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and COWAY.
Diversification Opportunities for Kosdaq Composite and COWAY
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kosdaq and COWAY is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and COWAY Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COWAY 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 COWAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COWAY has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and COWAY go up and down completely randomly.
Pair Corralation between Kosdaq Composite and COWAY
Assuming the 90 days trading horizon Kosdaq Composite Index is expected to under-perform the COWAY. But the index apears to be less risky and, when comparing its historical volatility, Kosdaq Composite Index is 1.39 times less risky than COWAY. The index trades about -0.07 of its potential returns per unit of risk. The COWAY Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 5,590,000 in COWAY Co on August 28, 2024 and sell it today you would earn a total of 690,000 from holding COWAY Co or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kosdaq Composite Index vs. COWAY Co
Performance |
| Timeline |
Kosdaq Composite and COWAY Volatility Contrast
Predicted Return Density |
| Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
COWAY Co
Pair trading matchups for COWAY
Pair Trading with Kosdaq Composite and COWAY
The main advantage of trading using opposite Kosdaq Composite and COWAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, COWAY 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 COWAY will offset losses from the drop in COWAY's long position.| Kosdaq Composite vs. Shinil Electronics Co | Kosdaq Composite vs. Sungdo Engineering Construction | Kosdaq Composite vs. Seoul Electronics Telecom | Kosdaq Composite vs. ENERGYMACHINERY KOREA CoLtd |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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