Correlation Between GemVaxKAEL CoLtd and Mirae Asset

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

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

Diversification Opportunities for GemVaxKAEL CoLtd and Mirae Asset

0.21

Correlation Coefficient

GemVaxKAEL CoLtd  Mirae Asset

Modest diversification

The 3 months correlation between GemVaxKAEL and Mirae is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding GemVaxKAEL CoLtd and Mirae Asset Daewoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirae Asset Daewoo and GemVaxKAEL CoLtd 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 GemVaxKAEL CoLtd are associated (or correlated) with Mirae Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirae Asset Daewoo has no effect on the direction of GemVaxKAEL CoLtd i.e., GemVaxKAEL CoLtd and Mirae Asset go up and down completely randomly.

Pair Corralation between GemVaxKAEL CoLtd and Mirae Asset

Assuming the 90 days trading horizon GemVaxKAEL CoLtd is expected to under-perform the Mirae Asset. In addition to that, GemVaxKAEL CoLtd is 5.14 times more volatile than Mirae Asset Daewoo. It trades about -0.03 of its total potential returns per unit of risk. Mirae Asset Daewoo is currently generating about 0.0 per unit of volatility. If you would invest  392,500  in Mirae Asset Daewoo on October 9, 2024 and sell it today you would lose (2,500) from holding Mirae Asset Daewoo or give up 0.64% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

GemVaxKAEL CoLtd  vs.  Mirae Asset Daewoo

GemVaxKAEL CoLtd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GemVaxKAEL CoLtd 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.

Mirae Asset Daewoo

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with GemVaxKAEL CoLtd and Mirae Asset

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

The idea behind GemVaxKAEL CoLtd and Mirae Asset Daewoo 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.