Correlation Between CKH Food and Korea New
Can any of the company-specific risk be diversified away by investing in both CKH Food and Korea New 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 CKH Food and Korea New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CKH Food Health and Korea New Network, you can compare the effects of market volatilities on CKH Food and Korea New 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 CKH Food with a short position of Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of CKH Food and Korea New.
Diversification Opportunities for CKH Food and Korea New
Very good diversification
The 3 months correlation between CKH and Korea is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding CKH Food Health and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network and CKH Food 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 CKH Food Health are associated (or correlated) with Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of CKH Food i.e., CKH Food and Korea New go up and down completely randomly.
Pair Corralation between CKH Food and Korea New
Assuming the 90 days trading horizon CKH Food Health is expected to under-perform the Korea New. In addition to that, CKH Food is 1.42 times more volatile than Korea New Network. It trades about -0.09 of its total potential returns per unit of risk. Korea New Network is currently generating about 0.16 per unit of volatility. If you would invest 72,200 in Korea New Network on September 14, 2024 and sell it today you would earn a total of 16,900 from holding Korea New Network or generate 23.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
CKH Food Health vs. Korea New Network
Performance |
Timeline |
CKH Food Health |
Korea New Network |
CKH Food and Korea New Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with CKH Food and Korea New
The main advantage of trading using opposite CKH Food and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CKH Food position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.CKH Food vs. Korea New Network | CKH Food vs. ICD Co | CKH Food vs. DYPNF CoLtd | CKH Food vs. Solution Advanced Technology |
Korea New vs. Settlebank | Korea New vs. Dgb Financial | Korea New vs. BIT Computer Co | Korea New vs. CG Hi Tech |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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