Correlation Between Camus Engineering and Dong A
Can any of the company-specific risk be diversified away by investing in both Camus Engineering and Dong A 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 Camus Engineering and Dong A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Camus Engineering Construction and Dong A Steel Technology, you can compare the effects of market volatilities on Camus Engineering and Dong A 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 Camus Engineering with a short position of Dong A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Camus Engineering and Dong A.
Diversification Opportunities for Camus Engineering and Dong A
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Camus and Dong is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Camus Engineering Construction and Dong A Steel Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dong A Steel and Camus Engineering 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 Camus Engineering Construction are associated (or correlated) with Dong A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dong A Steel has no effect on the direction of Camus Engineering i.e., Camus Engineering and Dong A go up and down completely randomly.
Pair Corralation between Camus Engineering and Dong A
Assuming the 90 days trading horizon Camus Engineering Construction is expected to under-perform the Dong A. But the stock apears to be less risky and, when comparing its historical volatility, Camus Engineering Construction is 2.37 times less risky than Dong A. The stock trades about -0.07 of its potential returns per unit of risk. The Dong A Steel Technology is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 322,000 in Dong A Steel Technology on August 29, 2024 and sell it today you would earn a total of 29,500 from holding Dong A Steel Technology or generate 9.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Camus Engineering Construction vs. Dong A Steel Technology
Performance |
| Timeline |
| Camus Engineering |
| Dong A Steel |
Camus Engineering and Dong A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Camus Engineering and Dong A
The main advantage of trading using opposite Camus Engineering and Dong A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Camus Engineering position performs unexpectedly, Dong A 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 Dong A will offset losses from the drop in Dong A's long position.| Camus Engineering vs. Coloray International Investment | Camus Engineering vs. Orbitech Co | Camus Engineering vs. Sangsangin Investment Securities | Camus Engineering vs. E Investment Development |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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