Correlation Between Ilji Technology and Daewoo SBI
Can any of the company-specific risk be diversified away by investing in both Ilji Technology and Daewoo SBI 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 Ilji Technology and Daewoo SBI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ilji Technology Co and Daewoo SBI SPAC, you can compare the effects of market volatilities on Ilji Technology and Daewoo SBI 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 Ilji Technology with a short position of Daewoo SBI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ilji Technology and Daewoo SBI.
Diversification Opportunities for Ilji Technology and Daewoo SBI
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ilji and Daewoo is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Ilji Technology Co and Daewoo SBI SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewoo SBI SPAC and Ilji Technology 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 Ilji Technology Co are associated (or correlated) with Daewoo SBI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewoo SBI SPAC has no effect on the direction of Ilji Technology i.e., Ilji Technology and Daewoo SBI go up and down completely randomly.
Pair Corralation between Ilji Technology and Daewoo SBI
Assuming the 90 days trading horizon Ilji Technology Co is expected to generate 1.56 times more return on investment than Daewoo SBI. However, Ilji Technology is 1.56 times more volatile than Daewoo SBI SPAC. It trades about 0.04 of its potential returns per unit of risk. Daewoo SBI SPAC is currently generating about -0.05 per unit of risk. If you would invest 237,000 in Ilji Technology Co on September 12, 2024 and sell it today you would earn a total of 115,000 from holding Ilji Technology Co or generate 48.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ilji Technology Co vs. Daewoo SBI SPAC
Performance |
| Timeline |
| Ilji Technology |
| Daewoo SBI SPAC |
Ilji Technology and Daewoo SBI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ilji Technology and Daewoo SBI
The main advantage of trading using opposite Ilji Technology and Daewoo SBI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ilji Technology position performs unexpectedly, Daewoo SBI 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 Daewoo SBI will offset losses from the drop in Daewoo SBI's long position.| Ilji Technology vs. Daou Data Corp | Ilji Technology vs. Solution Advanced Technology | Ilji Technology vs. Busan Industrial Co | Ilji Technology vs. Busan Ind |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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