Correlation Between Korea Electric and ChannelAdvisor Corp
Can any of the company-specific risk be diversified away by investing in both Korea Electric and ChannelAdvisor Corp 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 Korea Electric and ChannelAdvisor Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Electric Power and ChannelAdvisor Corp, you can compare the effects of market volatilities on Korea Electric and ChannelAdvisor Corp 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 Korea Electric with a short position of ChannelAdvisor Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Electric and ChannelAdvisor Corp.
Diversification Opportunities for Korea Electric and ChannelAdvisor Corp
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Korea and ChannelAdvisor is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Korea Electric Power and ChannelAdvisor Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ChannelAdvisor Corp and Korea Electric 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 Korea Electric Power are associated (or correlated) with ChannelAdvisor Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ChannelAdvisor Corp has no effect on the direction of Korea Electric i.e., Korea Electric and ChannelAdvisor Corp go up and down completely randomly.
Pair Corralation between Korea Electric and ChannelAdvisor Corp
If you would invest 2,309 in ChannelAdvisor Corp on January 31, 2024 and sell it today you would earn a total of 0.00 from holding ChannelAdvisor Corp or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 4.76% |
Values | Daily Returns |
Korea Electric Power vs. ChannelAdvisor Corp
Performance |
Timeline |
Korea Electric Power |
ChannelAdvisor Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Korea Electric and ChannelAdvisor Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Korea Electric and ChannelAdvisor Corp
The main advantage of trading using opposite Korea Electric and ChannelAdvisor Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Electric position performs unexpectedly, ChannelAdvisor Corp 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 ChannelAdvisor Corp will offset losses from the drop in ChannelAdvisor Corp's long position.Korea Electric vs. Centrais Eltricas Brasileiras | Korea Electric vs. Central Puerto SA | Korea Electric vs. CMS Energy |
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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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