Correlation Between DB Insurance and Korea Computer
Can any of the company-specific risk be diversified away by investing in both DB Insurance and Korea Computer 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 Korea Computer 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 Korea Computer Systems, you can compare the effects of market volatilities on DB Insurance and Korea Computer 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 Korea Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Insurance and Korea Computer.
Diversification Opportunities for DB Insurance and Korea Computer
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 005830 and Korea is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding DB Insurance Co and Korea Computer Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Computer Systems 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 Korea Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Computer Systems has no effect on the direction of DB Insurance i.e., DB Insurance and Korea Computer go up and down completely randomly.
Pair Corralation between DB Insurance and Korea Computer
Assuming the 90 days trading horizon DB Insurance Co is expected to under-perform the Korea Computer. But the stock apears to be less risky and, when comparing its historical volatility, DB Insurance Co is 4.32 times less risky than Korea Computer. The stock trades about -0.3 of its potential returns per unit of risk. The Korea Computer Systems is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 952,000 in Korea Computer Systems on October 26, 2024 and sell it today you would earn a total of 158,000 from holding Korea Computer Systems or generate 16.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
DB Insurance Co vs. Korea Computer Systems
Performance |
| Timeline |
| DB Insurance |
| Korea Computer Systems |
DB Insurance and Korea Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Insurance and Korea Computer
The main advantage of trading using opposite DB Insurance and Korea Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Insurance position performs unexpectedly, Korea Computer 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 Korea Computer will offset losses from the drop in Korea Computer's long position.| DB Insurance vs. DONGKUK TED METAL | DB Insurance vs. Incar Financial Service | DB Insurance vs. InfoBank | DB Insurance vs. Dongbang Transport Logistics |
| Korea Computer vs. Iljin Display | Korea Computer vs. LG Chemicals | Korea Computer vs. DB Insurance Co | Korea Computer vs. Sangsin Energy Display |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |