Correlation Between Daishin Information and MEDIPOST
Can any of the company-specific risk be diversified away by investing in both Daishin Information and MEDIPOST 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 MEDIPOST 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 MEDIPOST Co, you can compare the effects of market volatilities on Daishin Information and MEDIPOST 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 MEDIPOST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Information and MEDIPOST.
Diversification Opportunities for Daishin Information and MEDIPOST
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Daishin and MEDIPOST is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Information Communicat and MEDIPOST Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDIPOST 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 MEDIPOST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDIPOST has no effect on the direction of Daishin Information i.e., Daishin Information and MEDIPOST go up and down completely randomly.
Pair Corralation between Daishin Information and MEDIPOST
Assuming the 90 days trading horizon Daishin Information Communications is expected to under-perform the MEDIPOST. But the stock apears to be less risky and, when comparing its historical volatility, Daishin Information Communications is 1.8 times less risky than MEDIPOST. The stock trades about -0.03 of its potential returns per unit of risk. The MEDIPOST Co is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 719,000 in MEDIPOST Co on September 14, 2024 and sell it today you would earn a total of 467,000 from holding MEDIPOST Co or generate 64.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.62% |
| Values | Daily Returns |
Daishin Information Communicat vs. MEDIPOST Co
Performance |
| Timeline |
| Daishin Information |
| MEDIPOST |
Daishin Information and MEDIPOST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daishin Information and MEDIPOST
The main advantage of trading using opposite Daishin Information and MEDIPOST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Information position performs unexpectedly, MEDIPOST 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 MEDIPOST will offset losses from the drop in MEDIPOST's long position.| Daishin Information vs. Settlebank | Daishin Information vs. Solution Advanced Technology | Daishin Information vs. Busan Industrial Co | Daishin Information vs. Busan Ind |
| MEDIPOST vs. Ssangyong Information Communication | MEDIPOST vs. Koryo Credit Information | MEDIPOST vs. Korea Information Engineering | MEDIPOST vs. Daishin Information Communications |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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