Correlation Between Youl Chon and Gs Retail

Can any of the company-specific risk be diversified away by investing in both Youl Chon and Gs Retail 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 Youl Chon and Gs Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Youl Chon Chemical and Gs Retail, you can compare the effects of market volatilities on Youl Chon and Gs Retail 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 Youl Chon with a short position of Gs Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youl Chon and Gs Retail.

Diversification Opportunities for Youl Chon and Gs Retail

-0.64

Correlation Coefficient

Youl Chon  Gs Retail

Excellent diversification

The 3 months correlation between Youl and 007070 is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Youl Chon Chemical and Gs Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gs Retail and Youl Chon 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 Youl Chon Chemical are associated (or correlated) with Gs Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gs Retail has no effect on the direction of Youl Chon i.e., Youl Chon and Gs Retail go up and down completely randomly.

Pair Corralation between Youl Chon and Gs Retail

Assuming the 90 days trading horizon Youl Chon Chemical is expected to under-perform the Gs Retail. In addition to that, Youl Chon is 2.0 times more volatile than Gs Retail. It trades about -0.01 of its total potential returns per unit of risk. Gs Retail is currently generating about -0.01 per unit of volatility. If you would invest  2,750,502  in Gs Retail on September 20, 2024 and sell it today you would lose (435,502) from holding Gs Retail or give up 15.83% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Youl Chon Chemical  vs.  Gs Retail

Youl Chon Chemical

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Youl Chon Chemical has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Youl Chon is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gs Retail

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Gs Retail are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Gs Retail is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Youl Chon and Gs Retail

The main advantage of trading using opposite Youl Chon and Gs Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youl Chon position performs unexpectedly, Gs Retail 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 Gs Retail will offset losses from the drop in Gs Retail's long position.

The idea behind Youl Chon Chemical and Gs Retail pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Transaction History module to view history of all your transactions and understand their impact on performance.