Correlation Between Koryo Credit and Genolution

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

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

Diversification Opportunities for Koryo Credit and Genolution

-0.46

Correlation Coefficient

Koryo Credit  Genolution

Very good diversification

The 3 months correlation between Koryo and Genolution is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and Genolution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genolution and Koryo Credit 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 Koryo Credit Information are associated (or correlated) with Genolution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genolution has no effect on the direction of Koryo Credit i.e., Koryo Credit and Genolution go up and down completely randomly.

Pair Corralation between Koryo Credit and Genolution

Assuming the 90 days trading horizon Koryo Credit Information is expected to under-perform the Genolution. But the stock apears to be less risky and, when comparing its historical volatility, Koryo Credit Information is 5.55 times less risky than Genolution. The stock trades about -0.13 of its potential returns per unit of risk. The Genolution is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  227,000  in Genolution on October 15, 2024 and sell it today you would earn a total of  25,000  from holding Genolution or generate 11.01% return on investment over 90 days.

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

Koryo Credit Information  vs.  Genolution

Koryo Credit Information

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Koryo Credit Information are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Koryo Credit is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Genolution

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Genolution has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Koryo Credit and Genolution

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

The idea behind Koryo Credit Information and Genolution 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.