Correlation Between Daou Data and COWELL FASHION
Can any of the company-specific risk be diversified away by investing in both Daou Data and COWELL FASHION 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 Daou Data and COWELL FASHION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daou Data Corp and COWELL FASHION CoLtd, you can compare the effects of market volatilities on Daou Data and COWELL FASHION 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 Daou Data with a short position of COWELL FASHION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daou Data and COWELL FASHION.
Diversification Opportunities for Daou Data and COWELL FASHION
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daou and COWELL is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Daou Data Corp and COWELL FASHION CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COWELL FASHION CoLtd and Daou Data 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 Daou Data Corp are associated (or correlated) with COWELL FASHION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COWELL FASHION CoLtd has no effect on the direction of Daou Data i.e., Daou Data and COWELL FASHION go up and down completely randomly.
Pair Corralation between Daou Data and COWELL FASHION
Assuming the 90 days trading horizon Daou Data Corp is expected to generate 0.46 times more return on investment than COWELL FASHION. However, Daou Data Corp is 2.18 times less risky than COWELL FASHION. It trades about -0.05 of its potential returns per unit of risk. COWELL FASHION CoLtd is currently generating about -0.2 per unit of risk. If you would invest 1,095,000 in Daou Data Corp on September 2, 2024 and sell it today you would lose (14,000) from holding Daou Data Corp or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daou Data Corp vs. COWELL FASHION CoLtd
Performance |
| Timeline |
| Daou Data Corp |
| COWELL FASHION CoLtd |
Daou Data and COWELL FASHION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daou Data and COWELL FASHION
The main advantage of trading using opposite Daou Data and COWELL FASHION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daou Data position performs unexpectedly, COWELL FASHION 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 COWELL FASHION will offset losses from the drop in COWELL FASHION's long position.| Daou Data vs. Samsung Electronics Co | Daou Data vs. Samsung Electronics Co | Daou Data vs. KB Financial Group | Daou Data vs. Shinhan Financial Group |
| COWELL FASHION vs. AfreecaTV Co | COWELL FASHION vs. Nice Information Telecommunication | COWELL FASHION vs. Posco ICT | COWELL FASHION vs. LEENO Industrial |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |