Correlation Between DB Financial and PJ Metal
Can any of the company-specific risk be diversified away by investing in both DB Financial and PJ Metal 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 PJ Metal 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 PJ Metal Co, you can compare the effects of market volatilities on DB Financial and PJ Metal 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 PJ Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of DB Financial and PJ Metal.
Diversification Opportunities for DB Financial and PJ Metal
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between 016610 and 128660 is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding DB Financial Investment and PJ Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PJ Metal 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 PJ Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PJ Metal has no effect on the direction of DB Financial i.e., DB Financial and PJ Metal go up and down completely randomly.
Pair Corralation between DB Financial and PJ Metal
Assuming the 90 days trading horizon DB Financial Investment is expected to generate 0.7 times more return on investment than PJ Metal. However, DB Financial Investment is 1.44 times less risky than PJ Metal. It trades about 0.24 of its potential returns per unit of risk. PJ Metal Co is currently generating about 0.01 per unit of risk. If you would invest 493,500 in DB Financial Investment on September 14, 2024 and sell it today you would earn a total of 53,500 from holding DB Financial Investment or generate 10.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DB Financial Investment vs. PJ Metal Co
Performance |
| Timeline |
| DB Financial Investment |
| PJ Metal |
DB Financial and PJ Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DB Financial and PJ Metal
The main advantage of trading using opposite DB Financial and PJ Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DB Financial position performs unexpectedly, PJ Metal 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 PJ Metal will offset losses from the drop in PJ Metal's long position.| DB Financial vs. KB Financial Group | DB Financial vs. Shinhan Financial Group | DB Financial vs. Hana Financial | DB Financial vs. Woori Financial Group |
| PJ Metal vs. Miwon Chemicals Co | PJ Metal vs. Seoam Machinery Industry | PJ Metal vs. Dongbang Ship Machinery | PJ Metal vs. Mirai Semiconductors 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |