Correlation Between Daeduck Electronics and Korean Air
Can any of the company-specific risk be diversified away by investing in both Daeduck Electronics and Korean Air 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 Daeduck Electronics and Korean Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daeduck Electronics Co and Korean Air Lines, you can compare the effects of market volatilities on Daeduck Electronics and Korean Air 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 Daeduck Electronics with a short position of Korean Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daeduck Electronics and Korean Air.
Diversification Opportunities for Daeduck Electronics and Korean Air
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Daeduck and Korean is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Daeduck Electronics Co and Korean Air Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korean Air Lines and Daeduck Electronics 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 Daeduck Electronics Co are associated (or correlated) with Korean Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korean Air Lines has no effect on the direction of Daeduck Electronics i.e., Daeduck Electronics and Korean Air go up and down completely randomly.
Pair Corralation between Daeduck Electronics and Korean Air
Assuming the 90 days trading horizon Daeduck Electronics Co is expected to generate 0.47 times more return on investment than Korean Air. However, Daeduck Electronics Co is 2.13 times less risky than Korean Air. It trades about 0.2 of its potential returns per unit of risk. Korean Air Lines is currently generating about -0.13 per unit of risk. If you would invest 681,000 in Daeduck Electronics Co on December 1, 2024 and sell it today you would earn a total of 24,000 from holding Daeduck Electronics Co or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daeduck Electronics Co vs. Korean Air Lines
Performance |
| Timeline |
| Daeduck Electronics |
| Korean Air Lines |
Daeduck Electronics and Korean Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daeduck Electronics and Korean Air
The main advantage of trading using opposite Daeduck Electronics and Korean Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daeduck Electronics position performs unexpectedly, Korean Air 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 Korean Air will offset losses from the drop in Korean Air's long position.| Daeduck Electronics vs. Nam Hwa Construction | Daeduck Electronics vs. Tuksu Engineering ConstructionLtd | Daeduck Electronics vs. Ssangyong Information Communication | Daeduck Electronics vs. Dongwoo Farm To |
| Korean Air vs. Hanwha Life Insurance | Korean Air vs. Daishin Information Communications | Korean Air vs. Ssangyong Information Communication | Korean Air vs. Aprogen Healthcare Games |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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