Correlation Between CS BEARING and Jeju Beer

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

By analyzing existing cross correlation between CS BEARING CoLtd and Jeju Beer Co, you can compare the effects of market volatilities on CS BEARING and Jeju Beer 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 CS BEARING with a short position of Jeju Beer. Check out your portfolio center. Please also check ongoing floating volatility patterns of CS BEARING and Jeju Beer.

Diversification Opportunities for CS BEARING and Jeju Beer

-0.81

Correlation Coefficient

CS BEARING  Jeju Beer

Pay attention - limited upside

The 3 months correlation between 297090 and Jeju is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding CS BEARING CoLtd and Jeju Beer Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeju Beer and CS BEARING 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 CS BEARING CoLtd are associated (or correlated) with Jeju Beer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeju Beer has no effect on the direction of CS BEARING i.e., CS BEARING and Jeju Beer go up and down completely randomly.

Pair Corralation between CS BEARING and Jeju Beer

Assuming the 90 days trading horizon CS BEARING CoLtd is expected to generate 1.06 times more return on investment than Jeju Beer. However, CS BEARING is 1.06 times more volatile than Jeju Beer Co. It trades about 0.18 of its potential returns per unit of risk. Jeju Beer Co is currently generating about -0.07 per unit of risk. If you would invest  406,500  in CS BEARING CoLtd on December 3, 2024 and sell it today you would earn a total of  173,500  from holding CS BEARING CoLtd or generate 42.68% return on investment over 90 days.

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

CS BEARING CoLtd  vs.  Jeju Beer Co

CS BEARING CoLtd

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CS BEARING CoLtd are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, CS BEARING sustained solid returns over the last few months and may actually be approaching a breakup point.

Jeju Beer

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jeju Beer Co 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 CS BEARING and Jeju Beer

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

The idea behind CS BEARING CoLtd and Jeju Beer 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.