Correlation Between Dongsin Engineering and Total Soft
Can any of the company-specific risk be diversified away by investing in both Dongsin Engineering and Total Soft 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 Dongsin Engineering and Total Soft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongsin Engineering Construction and Total Soft Bank, you can compare the effects of market volatilities on Dongsin Engineering and Total Soft 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 Dongsin Engineering with a short position of Total Soft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongsin Engineering and Total Soft.
Diversification Opportunities for Dongsin Engineering and Total Soft
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Dongsin and Total is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Dongsin Engineering Constructi and Total Soft Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Soft Bank and Dongsin Engineering 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 Dongsin Engineering Construction are associated (or correlated) with Total Soft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Soft Bank has no effect on the direction of Dongsin Engineering i.e., Dongsin Engineering and Total Soft go up and down completely randomly.
Pair Corralation between Dongsin Engineering and Total Soft
Assuming the 90 days trading horizon Dongsin Engineering Construction is expected to generate 1.38 times more return on investment than Total Soft. However, Dongsin Engineering is 1.38 times more volatile than Total Soft Bank. It trades about 0.03 of its potential returns per unit of risk. Total Soft Bank is currently generating about 0.02 per unit of risk. If you would invest 1,926,000 in Dongsin Engineering Construction on September 2, 2024 and sell it today you would lose (4,000) from holding Dongsin Engineering Construction or give up 0.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongsin Engineering Constructi vs. Total Soft Bank
Performance |
| Timeline |
| Dongsin Engineering |
| Total Soft Bank |
Dongsin Engineering and Total Soft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongsin Engineering and Total Soft
The main advantage of trading using opposite Dongsin Engineering and Total Soft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongsin Engineering position performs unexpectedly, Total Soft 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 Total Soft will offset losses from the drop in Total Soft's long position.| Dongsin Engineering vs. Busan Industrial Co | Dongsin Engineering vs. Busan Ind | Dongsin Engineering vs. Mirae Asset Daewoo | Dongsin Engineering vs. Finebesteel |
| Total Soft vs. Devsisters corporation | Total Soft vs. Konan Technology | Total Soft vs. Nice Information Telecommunication | Total Soft vs. InfoBank |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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