Correlation Between Daiyang Metal and Samyung Trading
Can any of the company-specific risk be diversified away by investing in both Daiyang Metal and Samyung Trading 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 Daiyang Metal and Samyung Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daiyang Metal Co and Samyung Trading Co, you can compare the effects of market volatilities on Daiyang Metal and Samyung Trading 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 Daiyang Metal with a short position of Samyung Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daiyang Metal and Samyung Trading.
Diversification Opportunities for Daiyang Metal and Samyung Trading
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Daiyang and Samyung is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Daiyang Metal Co and Samyung Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samyung Trading and Daiyang 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 Daiyang Metal Co are associated (or correlated) with Samyung Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samyung Trading has no effect on the direction of Daiyang Metal i.e., Daiyang Metal and Samyung Trading go up and down completely randomly.
Pair Corralation between Daiyang Metal and Samyung Trading
Assuming the 90 days trading horizon Daiyang Metal Co is expected to under-perform the Samyung Trading. In addition to that, Daiyang Metal is 5.73 times more volatile than Samyung Trading Co. It trades about -0.01 of its total potential returns per unit of risk. Samyung Trading Co is currently generating about 0.01 per unit of volatility. If you would invest 1,219,432 in Samyung Trading Co on October 27, 2024 and sell it today you would earn a total of 24,568 from holding Samyung Trading Co or generate 2.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.96% |
| Values | Daily Returns |
Daiyang Metal Co vs. Samyung Trading Co
Performance |
| Timeline |
| Daiyang Metal |
| Samyung Trading |
Daiyang Metal and Samyung Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daiyang Metal and Samyung Trading
The main advantage of trading using opposite Daiyang Metal and Samyung Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daiyang Metal position performs unexpectedly, Samyung Trading 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 Samyung Trading will offset losses from the drop in Samyung Trading's long position.| Daiyang Metal vs. KB Financial Group | Daiyang Metal vs. Shinhan Financial Group | Daiyang Metal vs. Hana Financial | Daiyang Metal vs. Woori Financial Group |
| Samyung Trading vs. BIT Computer Co | Samyung Trading vs. Vissem Electronics Co | Samyung Trading vs. iNtRON Biotechnology | Samyung Trading vs. UJU Electronics 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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