Correlation Between Dongsin Engineering and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both Dongsin Engineering and Aprogen Healthcare 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 Aprogen Healthcare 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 Aprogen Healthcare Games, you can compare the effects of market volatilities on Dongsin Engineering and Aprogen Healthcare 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 Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongsin Engineering and Aprogen Healthcare.
Diversification Opportunities for Dongsin Engineering and Aprogen Healthcare
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dongsin and Aprogen is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Dongsin Engineering Constructi and Aprogen Healthcare Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aprogen Healthcare Games 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 Aprogen Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aprogen Healthcare Games has no effect on the direction of Dongsin Engineering i.e., Dongsin Engineering and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between Dongsin Engineering and Aprogen Healthcare
Assuming the 90 days trading horizon Dongsin Engineering Construction is expected to generate 1.69 times more return on investment than Aprogen Healthcare. However, Dongsin Engineering is 1.69 times more volatile than Aprogen Healthcare Games. It trades about 0.03 of its potential returns per unit of risk. Aprogen Healthcare Games is currently generating about -0.18 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 | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongsin Engineering Constructi vs. Aprogen Healthcare Games
Performance |
| Timeline |
| Dongsin Engineering |
| Aprogen Healthcare Games |
Dongsin Engineering and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongsin Engineering and Aprogen Healthcare
The main advantage of trading using opposite Dongsin Engineering and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongsin Engineering position performs unexpectedly, Aprogen Healthcare 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 Aprogen Healthcare will offset losses from the drop in Aprogen Healthcare's long position.| Dongsin Engineering vs. Busan Industrial Co | Dongsin Engineering vs. Busan Ind | Dongsin Engineering vs. Mirae Asset Daewoo | Dongsin Engineering vs. Finebesteel |
| Aprogen Healthcare vs. Dongsin Engineering Construction | Aprogen Healthcare vs. Doosan Fuel Cell | Aprogen Healthcare vs. Daishin Balance 1 | Aprogen Healthcare vs. Total Soft Bank |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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