Correlation Between DB Insurance and Coloray International
Can any of the company-specific risk be diversified away by investing in both DB Insurance and Coloray International 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 Coloray International 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 Coloray International Investment, you can compare the effects of market volatilities on DB Insurance and Coloray International 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 Coloray International. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Insurance and Coloray International.
Diversification Opportunities for DB Insurance and Coloray International
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 005830 and Coloray is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding DB Insurance Co and Coloray International Investme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coloray International 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 Coloray International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coloray International has no effect on the direction of DB Insurance i.e., DB Insurance and Coloray International go up and down completely randomly.
Pair Corralation between DB Insurance and Coloray International
Assuming the 90 days trading horizon DB Insurance Co is expected to generate 1.02 times more return on investment than Coloray International. However, DB Insurance is 1.02 times more volatile than Coloray International Investment. It trades about 0.02 of its potential returns per unit of risk. Coloray International Investment is currently generating about 0.0 per unit of risk. If you would invest 9,520,000 in DB Insurance Co on November 3, 2024 and sell it today you would earn a total of 190,000 from holding DB Insurance Co or generate 2.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DB Insurance Co vs. Coloray International Investme
Performance |
| Timeline |
| DB Insurance |
| Coloray International |
DB Insurance and Coloray International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Insurance and Coloray International
The main advantage of trading using opposite DB Insurance and Coloray International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Insurance position performs unexpectedly, Coloray International 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 Coloray International will offset losses from the drop in Coloray International's long position.| DB Insurance vs. Puloon Technology | DB Insurance vs. Koryo Credit Information | DB Insurance vs. PH Tech Co | DB Insurance vs. Jeju Bank |
| Coloray International vs. Lotte Data Communication | Coloray International vs. Korea Computer | Coloray International vs. CG Hi Tech | Coloray International 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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