Correlation Between COWINTECH and Young Poong

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

By analyzing existing cross correlation between COWINTECH Co and Young Poong Precision, you can compare the effects of market volatilities on COWINTECH and Young Poong 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 COWINTECH with a short position of Young Poong. Check out your portfolio center. Please also check ongoing floating volatility patterns of COWINTECH and Young Poong.

Diversification Opportunities for COWINTECH and Young Poong

-0.68

Correlation Coefficient

COWINTECH  Young Poong

Excellent diversification

The 3 months correlation between COWINTECH and Young is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding COWINTECH Co and Young Poong Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Young Poong Precision and COWINTECH 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 COWINTECH Co are associated (or correlated) with Young Poong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Young Poong Precision has no effect on the direction of COWINTECH i.e., COWINTECH and Young Poong go up and down completely randomly.

Pair Corralation between COWINTECH and Young Poong

Assuming the 90 days trading horizon COWINTECH Co is expected to generate 1.25 times more return on investment than Young Poong. However, COWINTECH is 1.25 times more volatile than Young Poong Precision. It trades about 0.09 of its potential returns per unit of risk. Young Poong Precision is currently generating about -0.22 per unit of risk. If you would invest  1,305,489  in COWINTECH Co on December 1, 2024 and sell it today you would earn a total of  189,511  from holding COWINTECH Co or generate 14.52% return on investment over 90 days.

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

COWINTECH Co  vs.  Young Poong Precision

COWINTECH

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in COWINTECH Co are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, COWINTECH sustained solid returns over the last few months and may actually be approaching a breakup point.

Young Poong Precision

Risk-Adjusted Performance

Very Weak

Over the last 90 days Young Poong Precision 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 April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with COWINTECH and Young Poong

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

The idea behind COWINTECH Co and Young Poong Precision 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.