Correlation Between Lotte Chilsung and Daelim Trading
Can any of the company-specific risk be diversified away by investing in both Lotte Chilsung and Daelim Trading 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 Lotte Chilsung and Daelim Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Chilsung Beverage and Daelim Trading Co, you can compare the effects of market volatilities on Lotte Chilsung and Daelim Trading 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 Lotte Chilsung with a short position of Daelim Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Chilsung and Daelim Trading.
Diversification Opportunities for Lotte Chilsung and Daelim Trading
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lotte and Daelim is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Chilsung Beverage and Daelim Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daelim Trading and Lotte Chilsung 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 Lotte Chilsung Beverage are associated (or correlated) with Daelim Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daelim Trading has no effect on the direction of Lotte Chilsung i.e., Lotte Chilsung and Daelim Trading go up and down completely randomly.
Pair Corralation between Lotte Chilsung and Daelim Trading
Assuming the 90 days trading horizon Lotte Chilsung Beverage is expected to under-perform the Daelim Trading. But the stock apears to be less risky and, when comparing its historical volatility, Lotte Chilsung Beverage is 1.56 times less risky than Daelim Trading. The stock trades about -0.02 of its potential returns per unit of risk. The Daelim Trading Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 267,500 in Daelim Trading Co on September 1, 2024 and sell it today you would earn a total of 10,000 from holding Daelim Trading Co or generate 3.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Chilsung Beverage vs. Daelim Trading Co
Performance |
| Timeline |
| Lotte Chilsung Beverage |
| Daelim Trading |
Lotte Chilsung and Daelim Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Chilsung and Daelim Trading
The main advantage of trading using opposite Lotte Chilsung and Daelim Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Chilsung position performs unexpectedly, Daelim Trading 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 Daelim Trading will offset losses from the drop in Daelim Trading's long position.| Lotte Chilsung vs. EV Advanced Material | Lotte Chilsung vs. DAEDUCK ELECTRONICS CoLtd | Lotte Chilsung vs. Hansol Homedeco Co | Lotte Chilsung vs. Hyundai Engineering Plastics |
| Daelim Trading vs. AptaBio Therapeutics | Daelim Trading vs. Daewoo SBI SPAC | Daelim Trading vs. Dream Security co | Daelim Trading vs. Microfriend |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |