Correlation Between Daishin Information and Anam Electronics
Can any of the company-specific risk be diversified away by investing in both Daishin Information and Anam Electronics 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 Daishin Information and Anam Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daishin Information Communications and Anam Electronics Co, you can compare the effects of market volatilities on Daishin Information and Anam Electronics 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 Daishin Information with a short position of Anam Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Information and Anam Electronics.
Diversification Opportunities for Daishin Information and Anam Electronics
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daishin and Anam is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Information Communicat and Anam Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anam Electronics and Daishin Information 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 Daishin Information Communications are associated (or correlated) with Anam Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anam Electronics has no effect on the direction of Daishin Information i.e., Daishin Information and Anam Electronics go up and down completely randomly.
Pair Corralation between Daishin Information and Anam Electronics
Assuming the 90 days trading horizon Daishin Information Communications is expected to generate 3.18 times more return on investment than Anam Electronics. However, Daishin Information is 3.18 times more volatile than Anam Electronics Co. It trades about 0.08 of its potential returns per unit of risk. Anam Electronics Co is currently generating about 0.16 per unit of risk. If you would invest 99,800 in Daishin Information Communications on October 11, 2024 and sell it today you would earn a total of 6,700 from holding Daishin Information Communications or generate 6.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daishin Information Communicat vs. Anam Electronics Co
Performance |
| Timeline |
| Daishin Information |
| Anam Electronics |
Daishin Information and Anam Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daishin Information and Anam Electronics
The main advantage of trading using opposite Daishin Information and Anam Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Information position performs unexpectedly, Anam Electronics 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 Anam Electronics will offset losses from the drop in Anam Electronics' long position.| Daishin Information vs. Eagon Industrial Co | Daishin Information vs. Seoyon Topmetal Co | Daishin Information vs. Daejung Chemicals Metals | Daishin Information vs. Youngsin Metal Industrial |
| Anam Electronics vs. Daesung Hi Tech Co | Anam Electronics vs. Daishin Information Communications | Anam Electronics vs. Samyang Foods Co | Anam Electronics vs. Asiana Airlines |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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