Correlation Between K One and Dufu Tech
Can any of the company-specific risk be diversified away by investing in both K One and Dufu Tech 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 K One and Dufu Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K One Technology Bhd and Dufu Tech Corp, you can compare the effects of market volatilities on K One and Dufu Tech 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 K One with a short position of Dufu Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of K One and Dufu Tech.
Diversification Opportunities for K One and Dufu Tech
Poor diversification
The 3 months correlation between 0111 and Dufu is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding K One Technology Bhd and Dufu Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dufu Tech Corp and K One 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 K One Technology Bhd are associated (or correlated) with Dufu Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dufu Tech Corp has no effect on the direction of K One i.e., K One and Dufu Tech go up and down completely randomly.
Pair Corralation between K One and Dufu Tech
Assuming the 90 days trading horizon K One Technology Bhd is expected to under-perform the Dufu Tech. In addition to that, K One is 2.5 times more volatile than Dufu Tech Corp. It trades about -0.01 of its total potential returns per unit of risk. Dufu Tech Corp is currently generating about 0.0 per unit of volatility. If you would invest 173.00 in Dufu Tech Corp on October 30, 2024 and sell it today you would lose (1.00) from holding Dufu Tech Corp or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
K One Technology Bhd vs. Dufu Tech Corp
Performance |
| Timeline |
| K One Technology |
| Dufu Tech Corp |
K One and Dufu Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K One and Dufu Tech
The main advantage of trading using opposite K One and Dufu Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K One position performs unexpectedly, Dufu Tech 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 Dufu Tech will offset losses from the drop in Dufu Tech's long position.| K One vs. Uchi Technologies Bhd | K One vs. Nexgram Holdings Bhd | K One vs. Digistar Bhd | K One vs. AirAsia X Bhd |
| Dufu Tech vs. SSF Home Group | Dufu Tech vs. Uchi Technologies Bhd | Dufu Tech vs. Lysaght Galvanized Steel | Dufu Tech vs. Petronas Chemicals Group |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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