Correlation Between DB Financial and SeAH Besteel
Can any of the company-specific risk be diversified away by investing in both DB Financial and SeAH Besteel 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 DB Financial and SeAH Besteel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DB Financial Investment and SeAH Besteel Corp, you can compare the effects of market volatilities on DB Financial and SeAH Besteel 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 DB Financial with a short position of SeAH Besteel. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Financial and SeAH Besteel.
Diversification Opportunities for DB Financial and SeAH Besteel
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 016610 and SeAH is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding DB Financial Investment and SeAH Besteel Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SeAH Besteel Corp and DB Financial 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 DB Financial Investment are associated (or correlated) with SeAH Besteel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SeAH Besteel Corp has no effect on the direction of DB Financial i.e., DB Financial and SeAH Besteel go up and down completely randomly.
Pair Corralation between DB Financial and SeAH Besteel
Assuming the 90 days trading horizon DB Financial Investment is expected to generate 0.88 times more return on investment than SeAH Besteel. However, DB Financial Investment is 1.14 times less risky than SeAH Besteel. It trades about 0.04 of its potential returns per unit of risk. SeAH Besteel Corp is currently generating about -0.17 per unit of risk. If you would invest 520,000 in DB Financial Investment on October 11, 2024 and sell it today you would earn a total of 5,000 from holding DB Financial Investment or generate 0.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DB Financial Investment vs. SeAH Besteel Corp
Performance |
| Timeline |
| DB Financial Investment |
| SeAH Besteel Corp |
DB Financial and SeAH Besteel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Financial and SeAH Besteel
The main advantage of trading using opposite DB Financial and SeAH Besteel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Financial position performs unexpectedly, SeAH Besteel 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 SeAH Besteel will offset losses from the drop in SeAH Besteel's long position.| DB Financial vs. Koryo Credit Information | DB Financial vs. DataSolution | DB Financial vs. Kakao Games Corp | DB Financial vs. Woorim Machinery Co |
| SeAH Besteel vs. Hanjin Transportation Co | SeAH Besteel vs. Dongbang Transport Logistics | SeAH Besteel vs. Aprogen Healthcare Games | SeAH Besteel vs. Daishin Information Communications |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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