Correlation Between Dongil Steel and Pharmsville
Can any of the company-specific risk be diversified away by investing in both Dongil Steel and Pharmsville 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 Dongil Steel and Pharmsville into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongil Steel Co and Pharmsville Co, you can compare the effects of market volatilities on Dongil Steel and Pharmsville 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 Dongil Steel with a short position of Pharmsville. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongil Steel and Pharmsville.
Diversification Opportunities for Dongil Steel and Pharmsville
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongil and Pharmsville is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Dongil Steel Co and Pharmsville Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pharmsville and Dongil 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 Dongil Steel Co are associated (or correlated) with Pharmsville. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pharmsville has no effect on the direction of Dongil Steel i.e., Dongil Steel and Pharmsville go up and down completely randomly.
Pair Corralation between Dongil Steel and Pharmsville
Assuming the 90 days trading horizon Dongil Steel Co is expected to generate 0.65 times more return on investment than Pharmsville. However, Dongil Steel Co is 1.53 times less risky than Pharmsville. It trades about -0.17 of its potential returns per unit of risk. Pharmsville Co is currently generating about -0.38 per unit of risk. If you would invest 124,500 in Dongil Steel Co on September 1, 2024 and sell it today you would lose (5,800) from holding Dongil Steel Co or give up 4.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dongil Steel Co vs. Pharmsville Co
Performance |
| Timeline |
| Dongil Steel |
| Pharmsville |
Dongil Steel and Pharmsville Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongil Steel and Pharmsville
The main advantage of trading using opposite Dongil Steel and Pharmsville positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongil Steel position performs unexpectedly, Pharmsville 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 Pharmsville will offset losses from the drop in Pharmsville's long position.| Dongil Steel vs. Keum Kang Steel | Dongil Steel vs. Tplex Co | Dongil Steel vs. Gyeongnam Steel Co | Dongil Steel vs. Jeil Steel Mfg |
| Pharmsville vs. J Steel Co | Pharmsville vs. Woori Technology | Pharmsville vs. Dongil Steel Co | Pharmsville vs. Han Kook Steel |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |