Correlation Between I Jang and Skardin Industrial

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

By analyzing existing cross correlation between I Jang Industrial and Skardin Industrial, you can compare the effects of market volatilities on I Jang and Skardin Industrial 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 I Jang with a short position of Skardin Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Jang and Skardin Industrial.

Diversification Opportunities for I Jang and Skardin Industrial

0.14

Correlation Coefficient

I Jang  Skardin Industrial

Average diversification

The 3 months correlation between 8342 and Skardin is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding I Jang Industrial and Skardin Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Skardin Industrial and I Jang 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 I Jang Industrial are associated (or correlated) with Skardin Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Skardin Industrial has no effect on the direction of I Jang i.e., I Jang and Skardin Industrial go up and down completely randomly.

Pair Corralation between I Jang and Skardin Industrial

Assuming the 90 days trading horizon I Jang Industrial is expected to generate 0.29 times more return on investment than Skardin Industrial. However, I Jang Industrial is 3.47 times less risky than Skardin Industrial. It trades about -0.04 of its potential returns per unit of risk. Skardin Industrial is currently generating about -0.04 per unit of risk. If you would invest  8,880  in I Jang Industrial on December 25, 2024 and sell it today you would lose (190.00) from holding I Jang Industrial or give up 2.14% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	98.21%
Values	Daily Returns

I Jang Industrial  vs.  Skardin Industrial

I Jang Industrial

Risk-Adjusted Performance

Very Weak

Over the last 90 days I Jang Industrial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, I Jang is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Skardin Industrial

Risk-Adjusted Performance

Very Weak

Over the last 90 days Skardin Industrial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with I Jang and Skardin Industrial

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

The idea behind I Jang Industrial and Skardin Industrial 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.