Correlation Between Cots Technology and CKH Food
Can any of the company-specific risk be diversified away by investing in both Cots Technology and CKH Food 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 Cots Technology and CKH Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cots Technology Co and CKH Food Health, you can compare the effects of market volatilities on Cots Technology and CKH Food 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 Cots Technology with a short position of CKH Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cots Technology and CKH Food.
Diversification Opportunities for Cots Technology and CKH Food
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cots and CKH is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Cots Technology Co and CKH Food Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKH Food Health and Cots Technology 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 Cots Technology Co are associated (or correlated) with CKH Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKH Food Health has no effect on the direction of Cots Technology i.e., Cots Technology and CKH Food go up and down completely randomly.
Pair Corralation between Cots Technology and CKH Food
Assuming the 90 days trading horizon Cots Technology Co is expected to under-perform the CKH Food. In addition to that, Cots Technology is 1.34 times more volatile than CKH Food Health. It trades about -0.27 of its total potential returns per unit of risk. CKH Food Health is currently generating about -0.17 per unit of volatility. If you would invest 7,400 in CKH Food Health on September 26, 2024 and sell it today you would lose (800.00) from holding CKH Food Health or give up 10.81% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Cots Technology Co vs. CKH Food Health
Performance |
Timeline |
Cots Technology |
CKH Food Health |
Cots Technology and CKH Food Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cots Technology and CKH Food
The main advantage of trading using opposite Cots Technology and CKH Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cots Technology position performs unexpectedly, CKH Food 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 CKH Food will offset losses from the drop in CKH Food's long position.Cots Technology vs. Samsung Electronics Co | Cots Technology vs. Samsung Electronics Co | Cots Technology vs. LG Energy Solution | Cots Technology vs. SK Hynix |
CKH Food vs. Woori Financial Group | CKH Food vs. Jb Financial | CKH Food vs. Nh Investment And | CKH Food vs. Kumho Petro Chemical |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
Other Complementary Tools
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |