Correlation Between Iljin Display and PlayD
Can any of the company-specific risk be diversified away by investing in both Iljin Display and PlayD 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 Iljin Display and PlayD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iljin Display and PlayD Co, you can compare the effects of market volatilities on Iljin Display and PlayD 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 Iljin Display with a short position of PlayD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iljin Display and PlayD.
Diversification Opportunities for Iljin Display and PlayD
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Iljin and PlayD is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Iljin Display and PlayD Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PlayD and Iljin Display 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 Iljin Display are associated (or correlated) with PlayD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PlayD has no effect on the direction of Iljin Display i.e., Iljin Display and PlayD go up and down completely randomly.
Pair Corralation between Iljin Display and PlayD
Assuming the 90 days trading horizon Iljin Display is expected to under-perform the PlayD. But the stock apears to be less risky and, when comparing its historical volatility, Iljin Display is 1.79 times less risky than PlayD. The stock trades about -0.03 of its potential returns per unit of risk. The PlayD Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 530,000 in PlayD Co on September 4, 2024 and sell it today you would earn a total of 98,000 from holding PlayD Co or generate 18.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Iljin Display vs. PlayD Co
Performance |
| Timeline |
| Iljin Display |
| PlayD |
Iljin Display and PlayD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iljin Display and PlayD
The main advantage of trading using opposite Iljin Display and PlayD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iljin Display position performs unexpectedly, PlayD 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 PlayD will offset losses from the drop in PlayD's long position.| Iljin Display vs. Nable Communications | Iljin Display vs. Digital Power Communications | Iljin Display vs. Shinhan Inverse Silver | Iljin Display vs. Mobileleader CoLtd |
| PlayD vs. CU Tech Corp | PlayD vs. Sungchang Autotech Co | PlayD vs. Yura Tech Co | PlayD vs. Cots Technology 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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