Correlation Between Youngsin Metal and Dongwon Ind
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Dongwon Ind 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 Youngsin Metal and Dongwon Ind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngsin Metal Industrial and Dongwon Ind, you can compare the effects of market volatilities on Youngsin Metal and Dongwon Ind 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 Youngsin Metal with a short position of Dongwon Ind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Dongwon Ind.
Diversification Opportunities for Youngsin Metal and Dongwon Ind
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Youngsin and Dongwon is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Dongwon Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwon Ind and Youngsin Metal 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 Youngsin Metal Industrial are associated (or correlated) with Dongwon Ind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwon Ind has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Dongwon Ind go up and down completely randomly.
Pair Corralation between Youngsin Metal and Dongwon Ind
Assuming the 90 days trading horizon Youngsin Metal Industrial is expected to under-perform the Dongwon Ind. In addition to that, Youngsin Metal is 1.27 times more volatile than Dongwon Ind. It trades about -0.29 of its total potential returns per unit of risk. Dongwon Ind is currently generating about -0.35 per unit of volatility. If you would invest 3,695,000 in Dongwon Ind on October 31, 2024 and sell it today you would lose (275,000) from holding Dongwon Ind or give up 7.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngsin Metal Industrial vs. Dongwon Ind
Performance |
| Timeline |
| Youngsin Metal Industrial |
| Dongwon Ind |
Youngsin Metal and Dongwon Ind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngsin Metal and Dongwon Ind
The main advantage of trading using opposite Youngsin Metal and Dongwon Ind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Dongwon Ind 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 Dongwon Ind will offset losses from the drop in Dongwon Ind's long position.| Youngsin Metal vs. Samsung Publishing Co | Youngsin Metal vs. FoodNamoo | Youngsin Metal vs. Sempio Foods Co | Youngsin Metal vs. YeaRimDang Publishing Co |
| Dongwon Ind vs. A Tech Solution Co | Dongwon Ind vs. FOODWELL Co | Dongwon Ind vs. FNSTech Co | Dongwon Ind vs. Solution Advanced Technology |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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