Correlation Between Dongil Technology and Miwon Chemicals
Can any of the company-specific risk be diversified away by investing in both Dongil Technology and Miwon Chemicals 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 Dongil Technology and Miwon Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongil Technology and Miwon Chemicals Co, you can compare the effects of market volatilities on Dongil Technology and Miwon Chemicals 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 Dongil Technology with a short position of Miwon Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongil Technology and Miwon Chemicals.
Diversification Opportunities for Dongil Technology and Miwon Chemicals
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongil and Miwon is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Dongil Technology and Miwon Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miwon Chemicals and Dongil Technology 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 Dongil Technology are associated (or correlated) with Miwon Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miwon Chemicals has no effect on the direction of Dongil Technology i.e., Dongil Technology and Miwon Chemicals go up and down completely randomly.
Pair Corralation between Dongil Technology and Miwon Chemicals
Assuming the 90 days trading horizon Dongil Technology is expected to generate 4.23 times less return on investment than Miwon Chemicals. In addition to that, Dongil Technology is 2.44 times more volatile than Miwon Chemicals Co. It trades about 0.01 of its total potential returns per unit of risk. Miwon Chemicals Co is currently generating about 0.06 per unit of volatility. If you would invest 5,958,035 in Miwon Chemicals Co on August 26, 2024 and sell it today you would earn a total of 1,741,965 from holding Miwon Chemicals Co or generate 29.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongil Technology vs. Miwon Chemicals Co
Performance |
| Timeline |
| Dongil Technology |
| Miwon Chemicals |
Dongil Technology and Miwon Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongil Technology and Miwon Chemicals
The main advantage of trading using opposite Dongil Technology and Miwon Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongil Technology position performs unexpectedly, Miwon Chemicals 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 Miwon Chemicals will offset losses from the drop in Miwon Chemicals' long position.| Dongil Technology vs. Miwon Chemicals Co | Dongil Technology vs. Shinhan Inverse Silver | Dongil Technology vs. Hana Financial | Dongil Technology vs. BGF Retail Co |
| Miwon Chemicals vs. PJ Metal Co | Miwon Chemicals vs. Formetal Co | Miwon Chemicals vs. Tway Air Co | Miwon Chemicals vs. Aprogen Healthcare Games |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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