Correlation Between Tuksu Engineering and Dongwoo Farm
Can any of the company-specific risk be diversified away by investing in both Tuksu Engineering and Dongwoo Farm 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 Tuksu Engineering and Dongwoo Farm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tuksu Engineering ConstructionLtd and Dongwoo Farm To, you can compare the effects of market volatilities on Tuksu Engineering and Dongwoo Farm 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 Tuksu Engineering with a short position of Dongwoo Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tuksu Engineering and Dongwoo Farm.
Diversification Opportunities for Tuksu Engineering and Dongwoo Farm
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Tuksu and Dongwoo is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Tuksu Engineering Construction and Dongwoo Farm To in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwoo Farm To and Tuksu 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 Tuksu Engineering ConstructionLtd are associated (or correlated) with Dongwoo Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwoo Farm To has no effect on the direction of Tuksu Engineering i.e., Tuksu Engineering and Dongwoo Farm go up and down completely randomly.
Pair Corralation between Tuksu Engineering and Dongwoo Farm
Assuming the 90 days trading horizon Tuksu Engineering ConstructionLtd is expected to generate 1.86 times more return on investment than Dongwoo Farm. However, Tuksu Engineering is 1.86 times more volatile than Dongwoo Farm To. It trades about 0.12 of its potential returns per unit of risk. Dongwoo Farm To is currently generating about 0.0 per unit of risk. If you would invest 651,000 in Tuksu Engineering ConstructionLtd on November 3, 2024 and sell it today you would earn a total of 23,000 from holding Tuksu Engineering ConstructionLtd or generate 3.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tuksu Engineering Construction vs. Dongwoo Farm To
Performance |
| Timeline |
| Tuksu Engineering |
| Dongwoo Farm To |
Tuksu Engineering and Dongwoo Farm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tuksu Engineering and Dongwoo Farm
The main advantage of trading using opposite Tuksu Engineering and Dongwoo Farm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tuksu Engineering position performs unexpectedly, Dongwoo Farm 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 Dongwoo Farm will offset losses from the drop in Dongwoo Farm's long position.| Tuksu Engineering vs. Dongkuk Structures Construction | Tuksu Engineering vs. KT Submarine Telecom | Tuksu Engineering vs. GS Engineering Construction | Tuksu Engineering vs. ENERGYMACHINERY KOREA CoLtd |
| Dongwoo Farm vs. Daiyang Metal Co | Dongwoo Farm vs. Ssangyong Information Communication | Dongwoo Farm vs. Heungkuk Metaltech CoLtd | Dongwoo Farm vs. Choil Aluminum |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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