Correlation Between Intellian Technologies and Wonil Special

Can any of the company-specific risk be diversified away by investing in both Intellian Technologies and Wonil Special 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 Intellian Technologies and Wonil Special into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intellian Technologies and Wonil Special Steel, you can compare the effects of market volatilities on Intellian Technologies and Wonil Special 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 Intellian Technologies with a short position of Wonil Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intellian Technologies and Wonil Special.

Diversification Opportunities for Intellian Technologies and Wonil Special

0.63

Correlation Coefficient

Intellian Technologies  Wonil Special

Poor diversification

The 3 months correlation between Intellian and Wonil is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Intellian Technologies and Wonil Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonil Special Steel and Intellian Technologies 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 Intellian Technologies are associated (or correlated) with Wonil Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonil Special Steel has no effect on the direction of Intellian Technologies i.e., Intellian Technologies and Wonil Special go up and down completely randomly.

Pair Corralation between Intellian Technologies and Wonil Special

Assuming the 90 days trading horizon Intellian Technologies is expected to under-perform the Wonil Special. In addition to that, Intellian Technologies is 2.42 times more volatile than Wonil Special Steel. It trades about -0.34 of its total potential returns per unit of risk. Wonil Special Steel is currently generating about -0.06 per unit of volatility. If you would invest  734,000  in Wonil Special Steel on September 12, 2024 and sell it today you would lose (21,000) from holding Wonil Special Steel or give up 2.86% of portfolio value over 90 days.

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

Intellian Technologies  vs.  Wonil Special Steel

Intellian Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intellian Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Wonil Special Steel

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Wonil Special Steel has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Wonil Special is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Intellian Technologies and Wonil Special

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

The idea behind Intellian Technologies and Wonil Special Steel 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.