Correlation Between Samlip General and Dongil Metal
Can any of the company-specific risk be diversified away by investing in both Samlip General and Dongil Metal 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 Samlip General and Dongil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samlip General Foods and Dongil Metal Co, you can compare the effects of market volatilities on Samlip General and Dongil Metal 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 Samlip General with a short position of Dongil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samlip General and Dongil Metal.
Diversification Opportunities for Samlip General and Dongil Metal
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Samlip and Dongil is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Samlip General Foods and Dongil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongil Metal and Samlip General 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 Samlip General Foods are associated (or correlated) with Dongil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongil Metal has no effect on the direction of Samlip General i.e., Samlip General and Dongil Metal go up and down completely randomly.
Pair Corralation between Samlip General and Dongil Metal
Assuming the 90 days trading horizon Samlip General Foods is expected to under-perform the Dongil Metal. But the stock apears to be less risky and, when comparing its historical volatility, Samlip General Foods is 1.14 times less risky than Dongil Metal. The stock trades about -0.26 of its potential returns per unit of risk. The Dongil Metal Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 815,000 in Dongil Metal Co on November 4, 2024 and sell it today you would earn a total of 20,000 from holding Dongil Metal Co or generate 2.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Samlip General Foods vs. Dongil Metal Co
Performance |
Timeline |
Samlip General Foods |
Dongil Metal |
Samlip General and Dongil Metal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samlip General and Dongil Metal
The main advantage of trading using opposite Samlip General and Dongil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samlip General position performs unexpectedly, Dongil Metal 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 Dongil Metal will offset losses from the drop in Dongil Metal's long position.Samlip General vs. Industrial Bank | Samlip General vs. Cube Entertainment | Samlip General vs. Dongil Metal Co | Samlip General vs. Daiyang Metal 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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