Correlation Between Daol Investment and KIWI Media
Can any of the company-specific risk be diversified away by investing in both Daol Investment and KIWI Media 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 Daol Investment and KIWI Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daol Investment Securities and KIWI Media Group, you can compare the effects of market volatilities on Daol Investment and KIWI Media 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 Daol Investment with a short position of KIWI Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daol Investment and KIWI Media.
Diversification Opportunities for Daol Investment and KIWI Media
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daol and KIWI is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Daol Investment Securities and KIWI Media Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KIWI Media Group and Daol Investment 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 Daol Investment Securities are associated (or correlated) with KIWI Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KIWI Media Group has no effect on the direction of Daol Investment i.e., Daol Investment and KIWI Media go up and down completely randomly.
Pair Corralation between Daol Investment and KIWI Media
Assuming the 90 days trading horizon Daol Investment Securities is expected to generate 0.46 times more return on investment than KIWI Media. However, Daol Investment Securities is 2.18 times less risky than KIWI Media. It trades about 0.07 of its potential returns per unit of risk. KIWI Media Group is currently generating about -0.15 per unit of risk. If you would invest 303,000 in Daol Investment Securities on September 26, 2024 and sell it today you would earn a total of 23,500 from holding Daol Investment Securities or generate 7.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daol Investment Securities vs. KIWI Media Group
Performance |
| Timeline |
| Daol Investment Secu |
| KIWI Media Group |
Daol Investment and KIWI Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daol Investment and KIWI Media
The main advantage of trading using opposite Daol Investment and KIWI Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daol Investment position performs unexpectedly, KIWI Media 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 KIWI Media will offset losses from the drop in KIWI Media's long position.| Daol Investment vs. Samsung Electronics Co | Daol Investment vs. Samsung Electronics Co | Daol Investment vs. LG Energy Solution | Daol Investment vs. SK Hynix |
| KIWI Media vs. Korea Investment Holdings | KIWI Media vs. Daol Investment Securities | KIWI Media vs. Jeong Moon Information | KIWI Media vs. TS Investment Corp |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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