Correlation Between Dongwon Metal and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both Dongwon Metal and Kukil 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 Dongwon Metal and Kukil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongwon Metal Co and Kukil Metal Co, you can compare the effects of market volatilities on Dongwon Metal and Kukil 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 Dongwon Metal with a short position of Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongwon Metal and Kukil Metal.
Diversification Opportunities for Dongwon Metal and Kukil Metal
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dongwon and Kukil is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Dongwon Metal Co and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal and Dongwon Metal 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 Dongwon Metal Co are associated (or correlated) with Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of Dongwon Metal i.e., Dongwon Metal and Kukil Metal go up and down completely randomly.
Pair Corralation between Dongwon Metal and Kukil Metal
Assuming the 90 days trading horizon Dongwon Metal Co is expected to generate 1.4 times more return on investment than Kukil Metal. However, Dongwon Metal is 1.4 times more volatile than Kukil Metal Co. It trades about -0.14 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.33 per unit of risk. If you would invest 122,700 in Dongwon Metal Co on August 28, 2024 and sell it today you would lose (8,400) from holding Dongwon Metal Co or give up 6.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongwon Metal Co vs. Kukil Metal Co
Performance |
| Timeline |
| Dongwon Metal |
| Kukil Metal |
Dongwon Metal and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongwon Metal and Kukil Metal
The main advantage of trading using opposite Dongwon Metal and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongwon Metal position performs unexpectedly, Kukil 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| Dongwon Metal vs. AptaBio Therapeutics | Dongwon Metal vs. Daewoo SBI SPAC | Dongwon Metal vs. Dream Security co | Dongwon Metal vs. Microfriend |
| Kukil Metal vs. Keum Kang Steel | Kukil Metal vs. Tplex Co | Kukil Metal vs. PJ Metal Co | Kukil Metal vs. Samhyun Steel 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |