Correlation Between DB Financial and Mobile Appliance
Can any of the company-specific risk be diversified away by investing in both DB Financial and Mobile Appliance 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 Mobile Appliance 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 Mobile Appliance, you can compare the effects of market volatilities on DB Financial and Mobile Appliance 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 Mobile Appliance. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Financial and Mobile Appliance.
Diversification Opportunities for DB Financial and Mobile Appliance
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 016610 and Mobile is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding DB Financial Investment and Mobile Appliance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Appliance 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 Mobile Appliance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Appliance has no effect on the direction of DB Financial i.e., DB Financial and Mobile Appliance go up and down completely randomly.
Pair Corralation between DB Financial and Mobile Appliance
Assuming the 90 days trading horizon DB Financial Investment is expected to generate 0.79 times more return on investment than Mobile Appliance. However, DB Financial Investment is 1.26 times less risky than Mobile Appliance. It trades about 0.08 of its potential returns per unit of risk. Mobile Appliance is currently generating about -0.05 per unit of risk. If you would invest 415,000 in DB Financial Investment on August 31, 2024 and sell it today you would earn a total of 101,000 from holding DB Financial Investment or generate 24.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DB Financial Investment vs. Mobile Appliance
Performance |
| Timeline |
| DB Financial Investment |
| Mobile Appliance |
DB Financial and Mobile Appliance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Financial and Mobile Appliance
The main advantage of trading using opposite DB Financial and Mobile Appliance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Financial position performs unexpectedly, Mobile Appliance 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 Mobile Appliance will offset losses from the drop in Mobile Appliance's long position.| DB Financial vs. TOPMATERIAL LTD | DB Financial vs. Union Materials Corp | DB Financial vs. SCI Information Service | DB Financial vs. National Plastic Co |
| Mobile Appliance vs. Samsung Electronics Co | Mobile Appliance vs. Samsung Electronics Co | Mobile Appliance vs. LG Energy Solution | Mobile Appliance vs. SK Hynix |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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