Correlation Between Daelim Trading and DAEDUCK ELECTRONICS
Can any of the company-specific risk be diversified away by investing in both Daelim Trading and DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS CoLtd, you can compare the effects of market volatilities on Daelim Trading and DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daelim Trading and DAEDUCK ELECTRONICS.
Diversification Opportunities for Daelim Trading and DAEDUCK ELECTRONICS
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daelim and DAEDUCK is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Daelim Trading Co and DAEDUCK ELECTRONICS CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAEDUCK ELECTRONICS CoLtd 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 DAEDUCK ELECTRONICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAEDUCK ELECTRONICS CoLtd has no effect on the direction of Daelim Trading i.e., Daelim Trading and DAEDUCK ELECTRONICS go up and down completely randomly.
Pair Corralation between Daelim Trading and DAEDUCK ELECTRONICS
Assuming the 90 days trading horizon Daelim Trading Co is expected to generate 1.74 times more return on investment than DAEDUCK ELECTRONICS. However, Daelim Trading is 1.74 times more volatile than DAEDUCK ELECTRONICS CoLtd. It trades about 0.07 of its potential returns per unit of risk. DAEDUCK ELECTRONICS CoLtd is currently generating about 0.04 per unit of risk. If you would invest 267,500 in Daelim Trading Co on September 1, 2024 and sell it today you would earn a total of 10,000 from holding Daelim Trading Co or generate 3.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daelim Trading Co vs. DAEDUCK ELECTRONICS CoLtd
Performance |
| Timeline |
| Daelim Trading |
| DAEDUCK ELECTRONICS CoLtd |
Daelim Trading and DAEDUCK ELECTRONICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daelim Trading and DAEDUCK ELECTRONICS
The main advantage of trading using opposite Daelim Trading and DAEDUCK ELECTRONICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daelim Trading position performs unexpectedly, DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS will offset losses from the drop in DAEDUCK ELECTRONICS's long position.| Daelim Trading vs. AptaBio Therapeutics | Daelim Trading vs. Daewoo SBI SPAC | Daelim Trading vs. Dream Security co | Daelim Trading vs. Microfriend |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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