Correlation Between DB Insurance and Pyung Hwa
Can any of the company-specific risk be diversified away by investing in both DB Insurance and Pyung Hwa 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 Pyung Hwa 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 Pyung Hwa Industrial, you can compare the effects of market volatilities on DB Insurance and Pyung Hwa 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 Pyung Hwa. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Insurance and Pyung Hwa.
Diversification Opportunities for DB Insurance and Pyung Hwa
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 005830 and Pyung is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding DB Insurance Co and Pyung Hwa Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyung Hwa Industrial 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 Pyung Hwa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyung Hwa Industrial has no effect on the direction of DB Insurance i.e., DB Insurance and Pyung Hwa go up and down completely randomly.
Pair Corralation between DB Insurance and Pyung Hwa
Assuming the 90 days trading horizon DB Insurance Co is expected to generate 1.01 times more return on investment than Pyung Hwa. However, DB Insurance is 1.01 times more volatile than Pyung Hwa Industrial. It trades about 0.07 of its potential returns per unit of risk. Pyung Hwa Industrial is currently generating about -0.02 per unit of risk. If you would invest 5,389,482 in DB Insurance Co on August 29, 2024 and sell it today you would earn a total of 4,940,518 from holding DB Insurance Co or generate 91.67% 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. Pyung Hwa Industrial
Performance |
| Timeline |
| DB Insurance |
| Pyung Hwa Industrial |
DB Insurance and Pyung Hwa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Insurance and Pyung Hwa
The main advantage of trading using opposite DB Insurance and Pyung Hwa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Insurance position performs unexpectedly, Pyung Hwa 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 Pyung Hwa will offset losses from the drop in Pyung Hwa's long position.| DB Insurance vs. Cube Entertainment | DB Insurance vs. Dreamus Company | DB Insurance vs. LG Energy Solution | DB Insurance vs. Dongwon System |
| Pyung Hwa vs. Dongbang Transport Logistics | Pyung Hwa vs. ITM Semiconductor Co | Pyung Hwa vs. HB Technology TD | Pyung Hwa vs. Sewoon Medical Co |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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