Correlation Between Daekyung Machinery and Carriesoft
Can any of the company-specific risk be diversified away by investing in both Daekyung Machinery and Carriesoft 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 Daekyung Machinery and Carriesoft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daekyung Machinery Engineering and Carriesoft Co, you can compare the effects of market volatilities on Daekyung Machinery and Carriesoft 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 Daekyung Machinery with a short position of Carriesoft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daekyung Machinery and Carriesoft.
Diversification Opportunities for Daekyung Machinery and Carriesoft
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Daekyung and Carriesoft is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Daekyung Machinery Engineering and Carriesoft Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carriesoft and Daekyung Machinery 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 Daekyung Machinery Engineering are associated (or correlated) with Carriesoft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carriesoft has no effect on the direction of Daekyung Machinery i.e., Daekyung Machinery and Carriesoft go up and down completely randomly.
Pair Corralation between Daekyung Machinery and Carriesoft
Assuming the 90 days trading horizon Daekyung Machinery Engineering is expected to generate 1.3 times more return on investment than Carriesoft. However, Daekyung Machinery is 1.3 times more volatile than Carriesoft Co. It trades about 0.33 of its potential returns per unit of risk. Carriesoft Co is currently generating about -0.15 per unit of risk. If you would invest 40,700 in Daekyung Machinery Engineering on September 2, 2024 and sell it today you would earn a total of 10,800 from holding Daekyung Machinery Engineering or generate 26.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.36% |
| Values | Daily Returns |
Daekyung Machinery Engineering vs. Carriesoft Co
Performance |
| Timeline |
| Daekyung Machinery |
| Carriesoft |
Daekyung Machinery and Carriesoft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daekyung Machinery and Carriesoft
The main advantage of trading using opposite Daekyung Machinery and Carriesoft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daekyung Machinery position performs unexpectedly, Carriesoft 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 Carriesoft will offset losses from the drop in Carriesoft's long position.| Daekyung Machinery vs. AptaBio Therapeutics | Daekyung Machinery vs. Daewoo SBI SPAC | Daekyung Machinery vs. Dream Security co | Daekyung Machinery vs. Microfriend |
| Carriesoft vs. Pureun Mutual Savings | Carriesoft vs. CJ Seafood Corp | Carriesoft vs. Nh Investment And | Carriesoft vs. SBI Investment KOREA |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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