Correlation Between Jeil Steel and CKH Food
Can any of the company-specific risk be diversified away by investing in both Jeil Steel and CKH Food 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 Jeil Steel and CKH Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeil Steel Mfg and CKH Food Health, you can compare the effects of market volatilities on Jeil Steel and CKH Food 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 Jeil Steel with a short position of CKH Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeil Steel and CKH Food.
Diversification Opportunities for Jeil Steel and CKH Food
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jeil and CKH is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Jeil Steel Mfg and CKH Food Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKH Food Health and Jeil Steel 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 Jeil Steel Mfg are associated (or correlated) with CKH Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKH Food Health has no effect on the direction of Jeil Steel i.e., Jeil Steel and CKH Food go up and down completely randomly.
Pair Corralation between Jeil Steel and CKH Food
Assuming the 90 days trading horizon Jeil Steel Mfg is expected to generate 1.46 times more return on investment than CKH Food. However, Jeil Steel is 1.46 times more volatile than CKH Food Health. It trades about 0.1 of its potential returns per unit of risk. CKH Food Health is currently generating about -0.09 per unit of risk. If you would invest 139,500 in Jeil Steel Mfg on September 24, 2024 and sell it today you would earn a total of 34,900 from holding Jeil Steel Mfg or generate 25.02% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Jeil Steel Mfg vs. CKH Food Health
Performance |
Timeline |
Jeil Steel Mfg |
CKH Food Health |
Jeil Steel and CKH Food Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Jeil Steel and CKH Food
The main advantage of trading using opposite Jeil Steel and CKH Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeil Steel position performs unexpectedly, CKH Food 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 CKH Food will offset losses from the drop in CKH Food's long position.Jeil Steel vs. Keum Kang Steel | Jeil Steel vs. Tplex Co | Jeil Steel vs. PJ Metal Co | Jeil Steel vs. Samhyun Steel Co |
CKH Food vs. Daishin Information Communications | CKH Food vs. Shinsegae Information Communication | CKH Food vs. Korea Alcohol Industrial | CKH Food vs. Display Tech Co |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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