Correlation Between Jb Financial and Heungkuk Metaltech

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

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

Diversification Opportunities for Jb Financial and Heungkuk Metaltech

0.01

Correlation Coefficient

Jb Financial  Heungkuk Metaltech

Significant diversification

The 3 months correlation between 175330 and Heungkuk is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Jb Financial and Heungkuk Metaltech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heungkuk Metaltech CoLtd and Jb Financial 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 Jb Financial are associated (or correlated) with Heungkuk Metaltech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heungkuk Metaltech CoLtd has no effect on the direction of Jb Financial i.e., Jb Financial and Heungkuk Metaltech go up and down completely randomly.

Pair Corralation between Jb Financial and Heungkuk Metaltech

Assuming the 90 days trading horizon Jb Financial is expected to under-perform the Heungkuk Metaltech. But the stock apears to be less risky and, when comparing its historical volatility, Jb Financial is 1.17 times less risky than Heungkuk Metaltech. The stock trades about -0.19 of its potential returns per unit of risk. The Heungkuk Metaltech CoLtd is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  478,000  in Heungkuk Metaltech CoLtd on September 22, 2024 and sell it today you would earn a total of  42,000  from holding Heungkuk Metaltech CoLtd or generate 8.79% return on investment over 90 days.

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

Jb Financial  vs.  Heungkuk Metaltech CoLtd

Jb Financial

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jb Financial are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jb Financial may actually be approaching a critical reversion point that can send shares even higher in January 2025.

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.

Pair Trading with Jb Financial and Heungkuk Metaltech

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

The idea behind Jb Financial and Heungkuk Metaltech CoLtd 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 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.