Correlation Between Innowireless and Playgram
Can any of the company-specific risk be diversified away by investing in both Innowireless and Playgram 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 Innowireless and Playgram into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innowireless Co and Playgram Co, you can compare the effects of market volatilities on Innowireless and Playgram 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 Innowireless with a short position of Playgram. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innowireless and Playgram.
Diversification Opportunities for Innowireless and Playgram
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Innowireless and Playgram is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Innowireless Co and Playgram Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Playgram and Innowireless 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 Innowireless Co are associated (or correlated) with Playgram. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Playgram has no effect on the direction of Innowireless i.e., Innowireless and Playgram go up and down completely randomly.
Pair Corralation between Innowireless and Playgram
Assuming the 90 days trading horizon Innowireless is expected to generate 2.84 times less return on investment than Playgram. But when comparing it to its historical volatility, Innowireless Co is 1.91 times less risky than Playgram. It trades about 0.05 of its potential returns per unit of risk. Playgram Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 30,700 in Playgram Co on April 25, 2025 and sell it today you would earn a total of 5,600 from holding Playgram Co or generate 18.24% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Innowireless Co vs. Playgram Co
Performance |
Timeline |
Innowireless |
Playgram |
Innowireless and Playgram Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Innowireless and Playgram
The main advantage of trading using opposite Innowireless and Playgram positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innowireless position performs unexpectedly, Playgram 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 Playgram will offset losses from the drop in Playgram's long position.Innowireless vs. KB Financial Group | Innowireless vs. Total Soft Bank | Innowireless vs. KakaoBank Corp | Innowireless vs. Dongbu Insurance Co |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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