Correlation Between Korea Environment and JUSUNG ENGINEERING

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

By analyzing existing cross correlation between Korea Environment Technology and JUSUNG ENGINEERING Co, you can compare the effects of market volatilities on Korea Environment and JUSUNG ENGINEERING 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 Environment with a short position of JUSUNG ENGINEERING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Environment and JUSUNG ENGINEERING.

Diversification Opportunities for Korea Environment and JUSUNG ENGINEERING

0.0

Correlation Coefficient

Korea Environment  JUSUNG ENGINEERING

Pay attention - limited upside

The 3 months correlation between Korea and JUSUNG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Korea Environment Technology and JUSUNG ENGINEERING Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JUSUNG ENGINEERING and Korea Environment 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 Environment Technology are associated (or correlated) with JUSUNG ENGINEERING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JUSUNG ENGINEERING has no effect on the direction of Korea Environment i.e., Korea Environment and JUSUNG ENGINEERING go up and down completely randomly.

Pair Corralation between Korea Environment and JUSUNG ENGINEERING

If you would invest  1,236,008  in JUSUNG ENGINEERING Co on October 6, 2024 and sell it today you would earn a total of  1,893,992  from holding JUSUNG ENGINEERING Co or generate 153.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.22%
Values	Daily Returns

Korea Environment Technology  vs.  JUSUNG ENGINEERING Co

Korea Environment

Risk-Adjusted Performance

0 of 100

Very Weak

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

JUSUNG ENGINEERING

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in JUSUNG ENGINEERING Co are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, JUSUNG ENGINEERING sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Korea Environment and JUSUNG ENGINEERING

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

The idea behind Korea Environment Technology and JUSUNG ENGINEERING Co 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.