Correlation Between Kosdaq Composite and TCC Steel
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By analyzing existing cross correlation between Kosdaq Composite Index and TCC Steel Corp, you can compare the effects of market volatilities on Kosdaq Composite and TCC Steel 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 Kosdaq Composite with a short position of TCC Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and TCC Steel.
Diversification Opportunities for Kosdaq Composite and TCC Steel
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kosdaq and TCC is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and TCC Steel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TCC Steel Corp and Kosdaq Composite 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 Kosdaq Composite Index are associated (or correlated) with TCC Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TCC Steel Corp has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and TCC Steel go up and down completely randomly.
Pair Corralation between Kosdaq Composite and TCC Steel
Assuming the 90 days trading horizon Kosdaq Composite Index is expected to generate 0.52 times more return on investment than TCC Steel. However, Kosdaq Composite Index is 1.91 times less risky than TCC Steel. It trades about 0.4 of its potential returns per unit of risk. TCC Steel Corp is currently generating about 0.06 per unit of risk. If you would invest 62,701 in Kosdaq Composite Index on October 9, 2024 and sell it today you would earn a total of 9,095 from holding Kosdaq Composite Index or generate 14.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Kosdaq Composite Index vs. TCC Steel Corp
Performance |
Timeline |
Kosdaq Composite and TCC Steel Volatility Contrast
Predicted Return Density |
Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
TCC Steel Corp
Pair trading matchups for TCC Steel
Pair Trading with Kosdaq Composite and TCC Steel
The main advantage of trading using opposite Kosdaq Composite and TCC Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, TCC Steel 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 TCC Steel will offset losses from the drop in TCC Steel's long position.Kosdaq Composite vs. Samyung Trading Co | Kosdaq Composite vs. Worldex Industry Trading | Kosdaq Composite vs. Choil Aluminum | Kosdaq Composite vs. E Investment Development |
TCC Steel vs. LG Chemicals | TCC Steel vs. BGF Retail Co | TCC Steel vs. Youngsin Metal Industrial | TCC Steel vs. Daejung Chemicals Metals |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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