Correlation Between Dongsin Engineering and Worldex Industry
Can any of the company-specific risk be diversified away by investing in both Dongsin Engineering and Worldex Industry 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 Worldex Industry 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 Worldex Industry Trading, you can compare the effects of market volatilities on Dongsin Engineering and Worldex Industry 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 Worldex Industry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongsin Engineering and Worldex Industry.
Diversification Opportunities for Dongsin Engineering and Worldex Industry
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dongsin and Worldex is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Dongsin Engineering Constructi and Worldex Industry Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Worldex Industry Trading 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 Worldex Industry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Worldex Industry Trading has no effect on the direction of Dongsin Engineering i.e., Dongsin Engineering and Worldex Industry go up and down completely randomly.
Pair Corralation between Dongsin Engineering and Worldex Industry
Assuming the 90 days trading horizon Dongsin Engineering is expected to generate 1.82 times less return on investment than Worldex Industry. In addition to that, Dongsin Engineering is 3.82 times more volatile than Worldex Industry Trading. It trades about 0.01 of its total potential returns per unit of risk. Worldex Industry Trading is currently generating about 0.08 per unit of volatility. If you would invest 1,658,927 in Worldex Industry Trading on October 17, 2024 and sell it today you would earn a total of 57,073 from holding Worldex Industry Trading or generate 3.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongsin Engineering Constructi vs. Worldex Industry Trading
Performance |
| Timeline |
| Dongsin Engineering |
| Worldex Industry Trading |
Dongsin Engineering and Worldex Industry Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongsin Engineering and Worldex Industry
The main advantage of trading using opposite Dongsin Engineering and Worldex Industry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongsin Engineering position performs unexpectedly, Worldex Industry 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 Worldex Industry will offset losses from the drop in Worldex Industry's long position.| Dongsin Engineering vs. Hwasung Industrial Co | Dongsin Engineering vs. PJ Metal Co | Dongsin Engineering vs. Songwon Industrial Co | Dongsin Engineering vs. Lee Ku Industrial |
| Worldex Industry vs. WONIK Materials CoLtd | Worldex Industry vs. SS TECH | Worldex Industry vs. TES Co | Worldex Industry vs. LEENO Industrial |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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