Correlation Between Youngsin Metal and Miwon Chemicals
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Miwon Chemicals 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 Youngsin Metal and Miwon Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngsin Metal Industrial and Miwon Chemicals Co, you can compare the effects of market volatilities on Youngsin Metal and Miwon Chemicals 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 Youngsin Metal with a short position of Miwon Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Miwon Chemicals.
Diversification Opportunities for Youngsin Metal and Miwon Chemicals
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Youngsin and Miwon is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Miwon Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miwon Chemicals and Youngsin Metal 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 Youngsin Metal Industrial are associated (or correlated) with Miwon Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miwon Chemicals has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Miwon Chemicals go up and down completely randomly.
Pair Corralation between Youngsin Metal and Miwon Chemicals
Assuming the 90 days trading horizon Youngsin Metal is expected to generate 5.18 times less return on investment than Miwon Chemicals. In addition to that, Youngsin Metal is 2.43 times more volatile than Miwon Chemicals Co. It trades about 0.0 of its total potential returns per unit of risk. Miwon Chemicals Co is currently generating about 0.06 per unit of volatility. If you would invest 6,267,577 in Miwon Chemicals Co on September 24, 2024 and sell it today you would earn a total of 1,732,423 from holding Miwon Chemicals Co or generate 27.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Youngsin Metal Industrial vs. Miwon Chemicals Co
Performance |
Timeline |
Youngsin Metal Industrial |
Miwon Chemicals |
Youngsin Metal and Miwon Chemicals Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Youngsin Metal and Miwon Chemicals
The main advantage of trading using opposite Youngsin Metal and Miwon Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Miwon Chemicals 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 Miwon Chemicals will offset losses from the drop in Miwon Chemicals' long position.Youngsin Metal vs. Busan Industrial Co | Youngsin Metal vs. Busan Ind | Youngsin Metal vs. Mirae Asset Daewoo | Youngsin Metal vs. Shinhan WTI Futures |
Miwon Chemicals vs. Youngsin Metal Industrial | Miwon Chemicals vs. Daejung Chemicals Metals | Miwon Chemicals vs. Duksan Hi Metal | Miwon Chemicals vs. DONGKUK TED METAL |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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