Correlation Between Total Soft and JUSUNG ENGINEERING

Can any of the company-specific risk be diversified away by investing in both Total Soft and JUSUNG ENGINEERING 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 Total Soft and JUSUNG ENGINEERING into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Total Soft Bank and JUSUNG ENGINEERING Co, you can compare the effects of market volatilities on Total Soft and JUSUNG ENGINEERING 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 Total Soft with a short position of JUSUNG ENGINEERING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Soft and JUSUNG ENGINEERING.

Diversification Opportunities for Total Soft and JUSUNG ENGINEERING

0.52

Correlation Coefficient

Total Soft  JUSUNG ENGINEERING

Very weak diversification

The 3 months correlation between Total and JUSUNG is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Total Soft Bank and JUSUNG ENGINEERING Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JUSUNG ENGINEERING and Total Soft 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 Total Soft Bank are associated (or correlated) with JUSUNG ENGINEERING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JUSUNG ENGINEERING has no effect on the direction of Total Soft i.e., Total Soft and JUSUNG ENGINEERING go up and down completely randomly.

Pair Corralation between Total Soft and JUSUNG ENGINEERING

Assuming the 90 days trading horizon Total Soft is expected to generate 2.11 times less return on investment than JUSUNG ENGINEERING. In addition to that, Total Soft is 1.23 times more volatile than JUSUNG ENGINEERING Co. It trades about 0.02 of its total potential returns per unit of risk. JUSUNG ENGINEERING Co is currently generating about 0.05 per unit of volatility. If you would invest  2,600,000  in JUSUNG ENGINEERING Co on September 2, 2024 and sell it today you would earn a total of  190,000  from holding JUSUNG ENGINEERING Co or generate 7.31% return on investment over 90 days.

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

Total Soft Bank  vs.  JUSUNG ENGINEERING Co

Total Soft Bank

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Total Soft Bank are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Total Soft is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

JUSUNG ENGINEERING

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in JUSUNG ENGINEERING Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, JUSUNG ENGINEERING may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Total Soft and JUSUNG ENGINEERING

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

The idea behind Total Soft Bank and JUSUNG ENGINEERING 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.