Correlation Between Chai Communication and Jeong Moon

Can any of the company-specific risk be diversified away by investing in both Chai Communication and Jeong Moon 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 Chai Communication and Jeong Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chai Communication Co,LTD and Jeong Moon Information, you can compare the effects of market volatilities on Chai Communication and Jeong Moon 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 Chai Communication with a short position of Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chai Communication and Jeong Moon.

Diversification Opportunities for Chai Communication and Jeong Moon

-0.58

Correlation Coefficient

Chai Communication  Jeong Moon

Excellent diversification

The 3 months correlation between Chai and Jeong is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Chai Communication Co,LTD and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information and Chai Communication 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 Chai Communication Co,LTD are associated (or correlated) with Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of Chai Communication i.e., Chai Communication and Jeong Moon go up and down completely randomly.

Pair Corralation between Chai Communication and Jeong Moon

Assuming the 90 days trading horizon Chai Communication Co,LTD is expected to under-perform the Jeong Moon. In addition to that, Chai Communication is 2.62 times more volatile than Jeong Moon Information. It trades about -0.09 of its total potential returns per unit of risk. Jeong Moon Information is currently generating about 0.09 per unit of volatility. If you would invest  84,400  in Jeong Moon Information on April 25, 2025 and sell it today you would earn a total of  5,500  from holding Jeong Moon Information or generate 6.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Chai Communication Co,LTD  vs.  Jeong Moon Information

Chai Communication Co,LTD

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chai Communication Co,LTD 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 August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Jeong Moon Information

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Jeong Moon Information are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Jeong Moon may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Chai Communication and Jeong Moon

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

The idea behind Chai Communication Co,LTD and Jeong Moon Information 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 Stocks Directory module to find actively traded stocks across global markets.