Correlation Between Korea Shipbuilding and EBEST Investment
Can any of the company-specific risk be diversified away by investing in both Korea Shipbuilding and EBEST Investment 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 Korea Shipbuilding and EBEST Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Shipbuilding Offshore and EBEST Investment Securities, you can compare the effects of market volatilities on Korea Shipbuilding and EBEST Investment 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 Korea Shipbuilding with a short position of EBEST Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Shipbuilding and EBEST Investment.
Diversification Opportunities for Korea Shipbuilding and EBEST Investment
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Korea and EBEST is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Korea Shipbuilding Offshore and EBEST Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EBEST Investment Sec and Korea Shipbuilding 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 Korea Shipbuilding Offshore are associated (or correlated) with EBEST Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EBEST Investment Sec has no effect on the direction of Korea Shipbuilding i.e., Korea Shipbuilding and EBEST Investment go up and down completely randomly.
Pair Corralation between Korea Shipbuilding and EBEST Investment
Assuming the 90 days trading horizon Korea Shipbuilding Offshore is expected to under-perform the EBEST Investment. In addition to that, Korea Shipbuilding is 2.32 times more volatile than EBEST Investment Securities. It trades about -0.04 of its total potential returns per unit of risk. EBEST Investment Securities is currently generating about 0.04 per unit of volatility. If you would invest 364,473 in EBEST Investment Securities on December 31, 2024 and sell it today you would earn a total of 9,027 from holding EBEST Investment Securities or generate 2.48% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Korea Shipbuilding Offshore vs. EBEST Investment Securities
Performance |
Timeline |
Korea Shipbuilding |
EBEST Investment Sec |
Korea Shipbuilding and EBEST Investment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Korea Shipbuilding and EBEST Investment
The main advantage of trading using opposite Korea Shipbuilding and EBEST Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Shipbuilding position performs unexpectedly, EBEST Investment 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 EBEST Investment will offset losses from the drop in EBEST Investment's long position.Korea Shipbuilding vs. Woori Technology Investment | Korea Shipbuilding vs. SK Chemicals Co | Korea Shipbuilding vs. Kukdong Oil Chemicals | Korea Shipbuilding vs. Daelim Trading Co |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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