Correlation Between Dongwon System and Haesung DS
Can any of the company-specific risk be diversified away by investing in both Dongwon System and Haesung DS 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 Dongwon System and Haesung DS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongwon System and Haesung DS Co, you can compare the effects of market volatilities on Dongwon System and Haesung DS 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 Dongwon System with a short position of Haesung DS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongwon System and Haesung DS.
Diversification Opportunities for Dongwon System and Haesung DS
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongwon and Haesung is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Dongwon System and Haesung DS Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haesung DS and Dongwon System 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 Dongwon System are associated (or correlated) with Haesung DS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haesung DS has no effect on the direction of Dongwon System i.e., Dongwon System and Haesung DS go up and down completely randomly.
Pair Corralation between Dongwon System and Haesung DS
Assuming the 90 days trading horizon Dongwon System is expected to generate 1.18 times more return on investment than Haesung DS. However, Dongwon System is 1.18 times more volatile than Haesung DS Co. It trades about 0.04 of its potential returns per unit of risk. Haesung DS Co is currently generating about -0.1 per unit of risk. If you would invest 3,403,378 in Dongwon System on September 20, 2024 and sell it today you would earn a total of 851,622 from holding Dongwon System or generate 25.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Dongwon System vs. Haesung DS Co
Performance |
| Timeline |
| Dongwon System |
| Haesung DS |
Dongwon System and Haesung DS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongwon System and Haesung DS
The main advantage of trading using opposite Dongwon System and Haesung DS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongwon System position performs unexpectedly, Haesung DS 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 Haesung DS will offset losses from the drop in Haesung DS's long position.| Dongwon System vs. Nable Communications | Dongwon System vs. Shinsegae Information Communication | Dongwon System vs. Ssangyong Information Communication | Dongwon System vs. Koryo Credit Information |
| Haesung DS vs. Cube Entertainment | Haesung DS vs. Dreamus Company | Haesung DS vs. LG Energy Solution | Haesung DS vs. Dongwon System |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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