Correlation Between Dongsin Engineering and Itcen
Can any of the company-specific risk be diversified away by investing in both Dongsin Engineering and Itcen 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 Itcen 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 Itcen Co, you can compare the effects of market volatilities on Dongsin Engineering and Itcen 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 Itcen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongsin Engineering and Itcen.
Diversification Opportunities for Dongsin Engineering and Itcen
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dongsin and Itcen is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Dongsin Engineering Constructi and Itcen Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Itcen 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 Itcen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Itcen has no effect on the direction of Dongsin Engineering i.e., Dongsin Engineering and Itcen go up and down completely randomly.
Pair Corralation between Dongsin Engineering and Itcen
Assuming the 90 days trading horizon Dongsin Engineering Construction is expected to generate 1.43 times more return on investment than Itcen. However, Dongsin Engineering is 1.43 times more volatile than Itcen Co. It trades about 0.07 of its potential returns per unit of risk. Itcen Co is currently generating about 0.03 per unit of risk. If you would invest 1,372,129 in Dongsin Engineering Construction on November 7, 2024 and sell it today you would earn a total of 2,947,871 from holding Dongsin Engineering Construction or generate 214.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.58% |
| Values | Daily Returns |
Dongsin Engineering Constructi vs. Itcen Co
Performance |
| Timeline |
| Dongsin Engineering |
| Itcen |
Dongsin Engineering and Itcen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongsin Engineering and Itcen
The main advantage of trading using opposite Dongsin Engineering and Itcen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongsin Engineering position performs unexpectedly, Itcen 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 Itcen will offset losses from the drop in Itcen's long position.| Dongsin Engineering vs. BIT Computer Co | Dongsin Engineering vs. Digital Power Communications | Dongsin Engineering vs. Puloon Technology | Dongsin Engineering vs. SK Telecom Co |
| Itcen vs. Samsung Electronics Co | Itcen vs. Samsung Electronics Co | Itcen vs. Hyundai Motor Co | Itcen vs. Hyundai Motor |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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