Correlation Between Heungkuk Metaltech and MediaZen

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

By analyzing existing cross correlation between Heungkuk Metaltech CoLtd and MediaZen, you can compare the effects of market volatilities on Heungkuk Metaltech and MediaZen 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 Heungkuk Metaltech with a short position of MediaZen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heungkuk Metaltech and MediaZen.

Diversification Opportunities for Heungkuk Metaltech and MediaZen

0.24

Correlation Coefficient

Heungkuk Metaltech  MediaZen

Modest diversification

The 3 months correlation between Heungkuk and MediaZen is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Heungkuk Metaltech CoLtd and MediaZen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MediaZen and Heungkuk Metaltech 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 Heungkuk Metaltech CoLtd are associated (or correlated) with MediaZen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MediaZen has no effect on the direction of Heungkuk Metaltech i.e., Heungkuk Metaltech and MediaZen go up and down completely randomly.

Pair Corralation between Heungkuk Metaltech and MediaZen

Assuming the 90 days trading horizon Heungkuk Metaltech is expected to generate 1.28 times less return on investment than MediaZen. In addition to that, Heungkuk Metaltech is 2.05 times more volatile than MediaZen. It trades about 0.06 of its total potential returns per unit of risk. MediaZen is currently generating about 0.17 per unit of volatility. If you would invest  1,022,000  in MediaZen on September 25, 2024 and sell it today you would earn a total of  108,000  from holding MediaZen or generate 10.57% return on investment over 90 days.

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

Heungkuk Metaltech CoLtd  vs.  MediaZen

Heungkuk Metaltech CoLtd

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Heungkuk Metaltech CoLtd are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Heungkuk Metaltech may actually be approaching a critical reversion point that can send shares even higher in January 2025.

MediaZen

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MediaZen are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, MediaZen may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Heungkuk Metaltech and MediaZen

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

The idea behind Heungkuk Metaltech CoLtd and MediaZen 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.

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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.