Correlation Between Jeil Steel and DB Insurance
Can any of the company-specific risk be diversified away by investing in both Jeil Steel and DB Insurance 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 Jeil Steel and DB Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeil Steel Mfg and DB Insurance Co, you can compare the effects of market volatilities on Jeil Steel and DB Insurance 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 Jeil Steel with a short position of DB Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeil Steel and DB Insurance.
Diversification Opportunities for Jeil Steel and DB Insurance
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jeil and 005830 is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Jeil Steel Mfg and DB Insurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Insurance and Jeil Steel 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 Jeil Steel Mfg are associated (or correlated) with DB Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Insurance has no effect on the direction of Jeil Steel i.e., Jeil Steel and DB Insurance go up and down completely randomly.
Pair Corralation between Jeil Steel and DB Insurance
Assuming the 90 days trading horizon Jeil Steel Mfg is expected to generate 1.69 times more return on investment than DB Insurance. However, Jeil Steel is 1.69 times more volatile than DB Insurance Co. It trades about 0.18 of its potential returns per unit of risk. DB Insurance Co is currently generating about -0.01 per unit of risk. If you would invest 128,000 in Jeil Steel Mfg on September 4, 2024 and sell it today you would earn a total of 64,300 from holding Jeil Steel Mfg or generate 50.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeil Steel Mfg vs. DB Insurance Co
Performance |
| Timeline |
| Jeil Steel Mfg |
| DB Insurance |
Jeil Steel and DB Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeil Steel and DB Insurance
The main advantage of trading using opposite Jeil Steel and DB Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeil Steel position performs unexpectedly, DB Insurance 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 DB Insurance will offset losses from the drop in DB Insurance's long position.| Jeil Steel vs. Keum Kang Steel | Jeil Steel vs. Tplex Co | Jeil Steel vs. Gyeongnam Steel Co | Jeil Steel vs. Daedong Steel Co |
| DB Insurance vs. Echomarketing CoLtd | DB Insurance vs. HB Technology TD | DB Insurance vs. Seoul Semiconductor Co | DB Insurance vs. Hwangkum Steel Technology |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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