Correlation Between Daedong Metals and IFamilySC
Can any of the company-specific risk be diversified away by investing in both Daedong Metals and IFamilySC 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 Daedong Metals and IFamilySC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daedong Metals Co and iFamilySC Co, you can compare the effects of market volatilities on Daedong Metals and IFamilySC 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 Daedong Metals with a short position of IFamilySC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daedong Metals and IFamilySC.
Diversification Opportunities for Daedong Metals and IFamilySC
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Daedong and IFamilySC is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Daedong Metals Co and iFamilySC Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iFamilySC and Daedong Metals 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 Daedong Metals Co are associated (or correlated) with IFamilySC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iFamilySC has no effect on the direction of Daedong Metals i.e., Daedong Metals and IFamilySC go up and down completely randomly.
Pair Corralation between Daedong Metals and IFamilySC
Assuming the 90 days trading horizon Daedong Metals Co is expected to generate 0.95 times more return on investment than IFamilySC. However, Daedong Metals Co is 1.05 times less risky than IFamilySC. It trades about 0.0 of its potential returns per unit of risk. iFamilySC Co is currently generating about -0.14 per unit of risk. If you would invest 839,000 in Daedong Metals Co on September 3, 2024 and sell it today you would lose (54,000) from holding Daedong Metals Co or give up 6.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daedong Metals Co vs. iFamilySC Co
Performance |
| Timeline |
| Daedong Metals |
| iFamilySC |
Daedong Metals and IFamilySC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daedong Metals and IFamilySC
The main advantage of trading using opposite Daedong Metals and IFamilySC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daedong Metals position performs unexpectedly, IFamilySC 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 IFamilySC will offset losses from the drop in IFamilySC's long position.| Daedong Metals vs. Ecocab Co | Daedong Metals vs. Daedong Gear Co | Daedong Metals vs. Hwashin Precision Engineering | Daedong Metals vs. YOUNGHWA TECH Co |
| IFamilySC vs. Display Tech Co | IFamilySC vs. NewFlex Technology Co | IFamilySC vs. HB Technology TD | IFamilySC vs. Sangsin Energy Display |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |