Correlation Between Ko Ja and Hunt Electronic
Can any of the company-specific risk be diversified away by investing in both Ko Ja and Hunt Electronic 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 Ko Ja and Hunt Electronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ko Ja Cayman and Hunt Electronic Co, you can compare the effects of market volatilities on Ko Ja and Hunt Electronic 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 Ko Ja with a short position of Hunt Electronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ko Ja and Hunt Electronic.
Diversification Opportunities for Ko Ja and Hunt Electronic
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 5215 and Hunt is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ko Ja Cayman and Hunt Electronic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunt Electronic and Ko Ja 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 Ko Ja Cayman are associated (or correlated) with Hunt Electronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunt Electronic has no effect on the direction of Ko Ja i.e., Ko Ja and Hunt Electronic go up and down completely randomly.
Pair Corralation between Ko Ja and Hunt Electronic
Assuming the 90 days trading horizon Ko Ja Cayman is expected to under-perform the Hunt Electronic. But the stock apears to be less risky and, when comparing its historical volatility, Ko Ja Cayman is 2.16 times less risky than Hunt Electronic. The stock trades about -0.05 of its potential returns per unit of risk. The Hunt Electronic Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,230 in Hunt Electronic Co on December 2, 2024 and sell it today you would lose (5.00) from holding Hunt Electronic Co or give up 0.22% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Ko Ja Cayman vs. Hunt Electronic Co
Performance |
Timeline |
Ko Ja Cayman |
Hunt Electronic |
Ko Ja and Hunt Electronic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Ko Ja and Hunt Electronic
The main advantage of trading using opposite Ko Ja and Hunt Electronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ko Ja position performs unexpectedly, Hunt Electronic 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 Hunt Electronic will offset losses from the drop in Hunt Electronic's long position.Ko Ja vs. Chenbro Micom Co | Ko Ja vs. ASRock Inc | Ko Ja vs. Emerging Display Technologies | Ko Ja vs. HannStar Board Corp |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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