Correlation Between Dongbu Steel and PLAYWITH
Can any of the company-specific risk be diversified away by investing in both Dongbu Steel and PLAYWITH 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 Dongbu Steel and PLAYWITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongbu Steel Co and PLAYWITH, you can compare the effects of market volatilities on Dongbu Steel and PLAYWITH 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 Dongbu Steel with a short position of PLAYWITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongbu Steel and PLAYWITH.
Diversification Opportunities for Dongbu Steel and PLAYWITH
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dongbu and PLAYWITH is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Dongbu Steel Co and PLAYWITH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYWITH and Dongbu Steel 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 Dongbu Steel Co are associated (or correlated) with PLAYWITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYWITH has no effect on the direction of Dongbu Steel i.e., Dongbu Steel and PLAYWITH go up and down completely randomly.
Pair Corralation between Dongbu Steel and PLAYWITH
Assuming the 90 days trading horizon Dongbu Steel Co is expected to under-perform the PLAYWITH. In addition to that, Dongbu Steel is 1.27 times more volatile than PLAYWITH. It trades about -0.05 of its total potential returns per unit of risk. PLAYWITH is currently generating about 0.0 per unit of volatility. If you would invest 367,500 in PLAYWITH on September 14, 2024 and sell it today you would lose (1,500) from holding PLAYWITH or give up 0.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongbu Steel Co vs. PLAYWITH
Performance |
| Timeline |
| Dongbu Steel |
| PLAYWITH |
Dongbu Steel and PLAYWITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongbu Steel and PLAYWITH
The main advantage of trading using opposite Dongbu Steel and PLAYWITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongbu Steel position performs unexpectedly, PLAYWITH 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 PLAYWITH will offset losses from the drop in PLAYWITH's long position.| Dongbu Steel vs. LG Chemicals | Dongbu Steel vs. POSCO Holdings | Dongbu Steel vs. Hanwha Solutions | Dongbu Steel vs. Lotte Chemical Corp |
| PLAYWITH vs. YG Entertainment | PLAYWITH vs. JYP Entertainment | PLAYWITH vs. Cube Entertainment | PLAYWITH vs. FNC Entertainment 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |