Correlation Between DB Insurance and HyVision System
Can any of the company-specific risk be diversified away by investing in both DB Insurance and HyVision System 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 HyVision System 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 HyVision System, you can compare the effects of market volatilities on DB Insurance and HyVision System 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 HyVision System. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Insurance and HyVision System.
Diversification Opportunities for DB Insurance and HyVision System
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 005830 and HyVision is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding DB Insurance Co and HyVision System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HyVision System 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 HyVision System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HyVision System has no effect on the direction of DB Insurance i.e., DB Insurance and HyVision System go up and down completely randomly.
Pair Corralation between DB Insurance and HyVision System
Assuming the 90 days trading horizon DB Insurance is expected to generate 5.24 times less return on investment than HyVision System. But when comparing it to its historical volatility, DB Insurance Co is 1.26 times less risky than HyVision System. It trades about 0.04 of its potential returns per unit of risk. HyVision System is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,532,000 in HyVision System on September 14, 2024 and sell it today you would earn a total of 189,000 from holding HyVision System or generate 12.34% 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. HyVision System
Performance |
| Timeline |
| DB Insurance |
| HyVision System |
DB Insurance and HyVision System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Insurance and HyVision System
The main advantage of trading using opposite DB Insurance and HyVision System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Insurance position performs unexpectedly, HyVision System 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 HyVision System will offset losses from the drop in HyVision System's long position.| DB Insurance vs. KB Financial Group | DB Insurance vs. Shinhan Financial Group | DB Insurance vs. Hana Financial | DB Insurance vs. Woori Financial Group |
| HyVision System vs. BGF Retail Co | HyVision System vs. DB Insurance Co | HyVision System vs. Lotte Data Communication | HyVision System vs. Kisan Telecom 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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