Correlation Between Ni Steel and DB Insurance
Can any of the company-specific risk be diversified away by investing in both Ni Steel and DB Insurance 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 Ni Steel and DB Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ni Steel and DB Insurance Co, you can compare the effects of market volatilities on Ni Steel and DB Insurance 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 Ni Steel with a short position of DB Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ni Steel and DB Insurance.
Diversification Opportunities for Ni Steel and DB Insurance
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 008260 and 005830 is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Ni Steel and DB Insurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Insurance and Ni Steel 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 Ni Steel are associated (or correlated) with DB Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Insurance has no effect on the direction of Ni Steel i.e., Ni Steel and DB Insurance go up and down completely randomly.
Pair Corralation between Ni Steel and DB Insurance
Assuming the 90 days trading horizon Ni Steel is expected to under-perform the DB Insurance. But the stock apears to be less risky and, when comparing its historical volatility, Ni Steel is 1.4 times less risky than DB Insurance. The stock trades about -0.03 of its potential returns per unit of risk. The DB Insurance Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 9,580,000 in DB Insurance Co on November 3, 2024 and sell it today you would earn a total of 130,000 from holding DB Insurance Co or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ni Steel vs. DB Insurance Co
Performance |
| Timeline |
| Ni Steel |
| DB Insurance |
Ni Steel and DB Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ni Steel and DB Insurance
The main advantage of trading using opposite Ni Steel and DB Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ni Steel position performs unexpectedly, DB Insurance 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 DB Insurance will offset losses from the drop in DB Insurance's long position.| Ni Steel vs. V One Tech Co | Ni Steel vs. CG Hi Tech | Ni Steel vs. Green Cross Medical | Ni Steel vs. Dongwoon Anatech Co |
| DB Insurance vs. Puloon Technology | DB Insurance vs. Koryo Credit Information | DB Insurance vs. PH Tech Co | DB Insurance vs. Jeju Bank |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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