Correlation Between Daelim Trading and MEDICOX
Can any of the company-specific risk be diversified away by investing in both Daelim Trading and MEDICOX 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 MEDICOX 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 MEDICOX Co, you can compare the effects of market volatilities on Daelim Trading and MEDICOX 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 MEDICOX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daelim Trading and MEDICOX.
Diversification Opportunities for Daelim Trading and MEDICOX
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daelim and MEDICOX is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Daelim Trading Co and MEDICOX Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDICOX 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 MEDICOX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDICOX has no effect on the direction of Daelim Trading i.e., Daelim Trading and MEDICOX go up and down completely randomly.
Pair Corralation between Daelim Trading and MEDICOX
Assuming the 90 days trading horizon Daelim Trading Co is expected to generate 0.39 times more return on investment than MEDICOX. However, Daelim Trading Co is 2.55 times less risky than MEDICOX. It trades about -0.02 of its potential returns per unit of risk. MEDICOX Co is currently generating about -0.06 per unit of risk. If you would invest 368,751 in Daelim Trading Co on September 13, 2024 and sell it today you would lose (114,751) from holding Daelim Trading Co or give up 31.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Daelim Trading Co vs. MEDICOX Co
Performance |
| Timeline |
| Daelim Trading |
| MEDICOX |
Daelim Trading and MEDICOX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daelim Trading and MEDICOX
The main advantage of trading using opposite Daelim Trading and MEDICOX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daelim Trading position performs unexpectedly, MEDICOX 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 MEDICOX will offset losses from the drop in MEDICOX's long position.| Daelim Trading vs. Samsung Electronics Co | Daelim Trading vs. Samsung Electronics Co | Daelim Trading vs. SK Hynix | Daelim Trading vs. POSCO Holdings |
| MEDICOX vs. Sangsangin Investment Securities | MEDICOX vs. Pureun Mutual Savings | MEDICOX vs. Woori Technology Investment | MEDICOX vs. Daelim Trading 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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