Correlation Between Ruentex Development and Koge Micro

Can any of the company-specific risk be diversified away by investing in both Ruentex Development and Koge Micro 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 Ruentex Development and Koge Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ruentex Development Co and Koge Micro Tech, you can compare the effects of market volatilities on Ruentex Development and Koge Micro 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 Ruentex Development with a short position of Koge Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ruentex Development and Koge Micro.

Diversification Opportunities for Ruentex Development and Koge Micro

0.0

Correlation Coefficient

Ruentex Development  Koge Micro

Pay attention - limited upside

The 3 months correlation between Ruentex and Koge is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ruentex Development Co and Koge Micro Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koge Micro Tech and Ruentex Development 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 Ruentex Development Co are associated (or correlated) with Koge Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koge Micro Tech has no effect on the direction of Ruentex Development i.e., Ruentex Development and Koge Micro go up and down completely randomly.

Pair Corralation between Ruentex Development and Koge Micro

If you would invest  3,550  in Ruentex Development Co on March 14, 2024 and sell it today you would earn a total of  1,035  from holding Ruentex Development Co or generate 29.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Ruentex Development Co  vs.  Koge Micro Tech

Ruentex Development

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ruentex Development Co are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Ruentex Development showed solid returns over the last few months and may actually be approaching a breakup point.

Koge Micro Tech

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Koge Micro Tech has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Koge Micro is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Ruentex Development and Koge Micro

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

The idea behind Ruentex Development Co and Koge Micro Tech 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.