Correlation Between DB Insurance and UNISEM
Can any of the company-specific risk be diversified away by investing in both DB Insurance and UNISEM 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 DB Insurance and UNISEM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DB Insurance Co and UNISEM Co, you can compare the effects of market volatilities on DB Insurance and UNISEM 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 DB Insurance with a short position of UNISEM. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Insurance and UNISEM.
Diversification Opportunities for DB Insurance and UNISEM
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 005830 and UNISEM is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding DB Insurance Co and UNISEM Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNISEM and DB Insurance 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 DB Insurance Co are associated (or correlated) with UNISEM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNISEM has no effect on the direction of DB Insurance i.e., DB Insurance and UNISEM go up and down completely randomly.
Pair Corralation between DB Insurance and UNISEM
Assuming the 90 days trading horizon DB Insurance Co is expected to generate 1.03 times more return on investment than UNISEM. However, DB Insurance is 1.03 times more volatile than UNISEM Co. It trades about 0.03 of its potential returns per unit of risk. UNISEM Co is currently generating about -0.34 per unit of risk. If you would invest 11,250,000 in DB Insurance Co on September 4, 2024 and sell it today you would earn a total of 120,000 from holding DB Insurance Co or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DB Insurance Co vs. UNISEM Co
Performance |
| Timeline |
| DB Insurance |
| UNISEM |
DB Insurance and UNISEM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Insurance and UNISEM
The main advantage of trading using opposite DB Insurance and UNISEM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Insurance position performs unexpectedly, UNISEM 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 UNISEM will offset losses from the drop in UNISEM's long position.| DB Insurance vs. Echomarketing CoLtd | DB Insurance vs. HB Technology TD | DB Insurance vs. Seoul Semiconductor Co | DB Insurance vs. Hwangkum Steel Technology |
| UNISEM vs. Coloray International Investment | UNISEM vs. NH Investment Securities | UNISEM vs. DB Insurance Co | UNISEM vs. Total Soft Bank |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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