Correlation Between Daesung Private and Seoul Semiconductor
Can any of the company-specific risk be diversified away by investing in both Daesung Private and Seoul Semiconductor 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 Daesung Private and Seoul Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daesung Private Equity and Seoul Semiconductor Co, you can compare the effects of market volatilities on Daesung Private and Seoul Semiconductor 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 Daesung Private with a short position of Seoul Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daesung Private and Seoul Semiconductor.
Diversification Opportunities for Daesung Private and Seoul Semiconductor
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Daesung and Seoul is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Daesung Private Equity and Seoul Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seoul Semiconductor and Daesung Private 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 Daesung Private Equity are associated (or correlated) with Seoul Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seoul Semiconductor has no effect on the direction of Daesung Private i.e., Daesung Private and Seoul Semiconductor go up and down completely randomly.
Pair Corralation between Daesung Private and Seoul Semiconductor
Assuming the 90 days trading horizon Daesung Private Equity is expected to under-perform the Seoul Semiconductor. In addition to that, Daesung Private is 1.29 times more volatile than Seoul Semiconductor Co. It trades about -0.03 of its total potential returns per unit of risk. Seoul Semiconductor Co is currently generating about 0.07 per unit of volatility. If you would invest 710,000 in Seoul Semiconductor Co on November 3, 2024 and sell it today you would earn a total of 14,000 from holding Seoul Semiconductor Co or generate 1.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daesung Private Equity vs. Seoul Semiconductor Co
Performance |
| Timeline |
| Daesung Private Equity |
| Seoul Semiconductor |
Daesung Private and Seoul Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daesung Private and Seoul Semiconductor
The main advantage of trading using opposite Daesung Private and Seoul Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daesung Private position performs unexpectedly, Seoul Semiconductor 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 Seoul Semiconductor will offset losses from the drop in Seoul Semiconductor's long position.| Daesung Private vs. GS Retail Co | Daesung Private vs. Ssangyong Materials Corp | Daesung Private vs. Kolon Plastics | Daesung Private vs. Ecoplastic |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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