Correlation Between Daelim Trading and Korea Gas
Can any of the company-specific risk be diversified away by investing in both Daelim Trading and Korea Gas 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 Daelim Trading and Korea Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daelim Trading Co and Korea Gas, you can compare the effects of market volatilities on Daelim Trading and Korea Gas 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 Daelim Trading with a short position of Korea Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daelim Trading and Korea Gas.
Diversification Opportunities for Daelim Trading and Korea Gas
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daelim and Korea is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Daelim Trading Co and Korea Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Gas and Daelim Trading 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 Daelim Trading Co are associated (or correlated) with Korea Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Gas has no effect on the direction of Daelim Trading i.e., Daelim Trading and Korea Gas go up and down completely randomly.
Pair Corralation between Daelim Trading and Korea Gas
Assuming the 90 days trading horizon Daelim Trading Co is expected to generate 0.42 times more return on investment than Korea Gas. However, Daelim Trading Co is 2.39 times less risky than Korea Gas. It trades about -0.18 of its potential returns per unit of risk. Korea Gas is currently generating about -0.11 per unit of risk. If you would invest 289,000 in Daelim Trading Co on September 12, 2024 and sell it today you would lose (27,500) from holding Daelim Trading Co or give up 9.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daelim Trading Co vs. Korea Gas
Performance |
| Timeline |
| Daelim Trading |
| Korea Gas |
Daelim Trading and Korea Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daelim Trading and Korea Gas
The main advantage of trading using opposite Daelim Trading and Korea Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daelim Trading position performs unexpectedly, Korea Gas 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 Gas will offset losses from the drop in Korea Gas' long position.| Daelim Trading vs. Samsung Electronics Co | Daelim Trading vs. Samsung Electronics Co | Daelim Trading vs. SK Hynix | Daelim Trading vs. POSCO Holdings |
| Korea Gas vs. Pungguk Ethanol Industrial | Korea Gas vs. Cheryong Industrial CoLtd | Korea Gas vs. KakaoBank Corp | Korea Gas vs. MetaLabs 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |