Correlation Between Youngsin Metal and Dreamus
Can any of the company-specific risk be diversified away by investing in both Youngsin Metal and Dreamus 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 Dreamus 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 Dreamus Company, you can compare the effects of market volatilities on Youngsin Metal and Dreamus 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 Dreamus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngsin Metal and Dreamus.
Diversification Opportunities for Youngsin Metal and Dreamus
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Youngsin and Dreamus is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Youngsin Metal Industrial and Dreamus Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreamus Company 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 Dreamus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreamus Company has no effect on the direction of Youngsin Metal i.e., Youngsin Metal and Dreamus go up and down completely randomly.
Pair Corralation between Youngsin Metal and Dreamus
Assuming the 90 days trading horizon Youngsin Metal Industrial is expected to generate 0.47 times more return on investment than Dreamus. However, Youngsin Metal Industrial is 2.11 times less risky than Dreamus. It trades about -0.08 of its potential returns per unit of risk. Dreamus Company is currently generating about -0.04 per unit of risk. If you would invest 286,500 in Youngsin Metal Industrial on September 19, 2024 and sell it today you would lose (59,500) from holding Youngsin Metal Industrial or give up 20.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngsin Metal Industrial vs. Dreamus Company
Performance |
| Timeline |
| Youngsin Metal Industrial |
| Dreamus Company |
Youngsin Metal and Dreamus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngsin Metal and Dreamus
The main advantage of trading using opposite Youngsin Metal and Dreamus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngsin Metal position performs unexpectedly, Dreamus 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 Dreamus will offset losses from the drop in Dreamus' long position.| Youngsin Metal vs. Korea New Network | Youngsin Metal vs. Solution Advanced Technology | Youngsin Metal vs. Busan Industrial Co | Youngsin Metal vs. Busan Ind |
| Dreamus vs. Automobile Pc | Dreamus vs. Youngsin Metal Industrial | Dreamus vs. Shinsegae Information Communication | Dreamus vs. Wireless Power Amplifier |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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