Correlation Between Youl Chon and Daewoo Engineering
Can any of the company-specific risk be diversified away by investing in both Youl Chon and Daewoo Engineering 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 Youl Chon and Daewoo Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youl Chon Chemical and Daewoo Engineering Construction, you can compare the effects of market volatilities on Youl Chon and Daewoo Engineering 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 Youl Chon with a short position of Daewoo Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youl Chon and Daewoo Engineering.
Diversification Opportunities for Youl Chon and Daewoo Engineering
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Youl and Daewoo is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Youl Chon Chemical and Daewoo Engineering Constructio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewoo Engineering and Youl Chon 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 Youl Chon Chemical are associated (or correlated) with Daewoo Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewoo Engineering has no effect on the direction of Youl Chon i.e., Youl Chon and Daewoo Engineering go up and down completely randomly.
Pair Corralation between Youl Chon and Daewoo Engineering
Assuming the 90 days trading horizon Youl Chon Chemical is expected to under-perform the Daewoo Engineering. In addition to that, Youl Chon is 1.89 times more volatile than Daewoo Engineering Construction. It trades about -0.01 of its total potential returns per unit of risk. Daewoo Engineering Construction is currently generating about -0.01 per unit of volatility. If you would invest 438,500 in Daewoo Engineering Construction on August 31, 2024 and sell it today you would lose (64,000) from holding Daewoo Engineering Construction or give up 14.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Youl Chon Chemical vs. Daewoo Engineering Constructio
Performance |
| Timeline |
| Youl Chon Chemical |
| Daewoo Engineering |
Youl Chon and Daewoo Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youl Chon and Daewoo Engineering
The main advantage of trading using opposite Youl Chon and Daewoo Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youl Chon position performs unexpectedly, Daewoo Engineering 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 Daewoo Engineering will offset losses from the drop in Daewoo Engineering's long position.| Youl Chon vs. AptaBio Therapeutics | Youl Chon vs. Daewoo SBI SPAC | Youl Chon vs. Dream Security co | Youl Chon vs. Microfriend |
| Daewoo Engineering vs. Air Busan Co | Daewoo Engineering vs. Korea Air Svc | Daewoo Engineering vs. Cloud Air CoLtd | Daewoo Engineering vs. Jeju Air Co |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |