Correlation Between DIGITAL CHOSUN and Han Kook
Can any of the company-specific risk be diversified away by investing in both DIGITAL CHOSUN and Han Kook 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 DIGITAL CHOSUN and Han Kook into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DIGITAL CHOSUN and Han Kook Steel, you can compare the effects of market volatilities on DIGITAL CHOSUN and Han Kook 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 DIGITAL CHOSUN with a short position of Han Kook. Check out your portfolio center. Please also check ongoing floating volatility patterns of DIGITAL CHOSUN and Han Kook.
Diversification Opportunities for DIGITAL CHOSUN and Han Kook
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DIGITAL and Han is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding DIGITAL CHOSUN and Han Kook Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Han Kook Steel and DIGITAL CHOSUN 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 DIGITAL CHOSUN are associated (or correlated) with Han Kook. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Han Kook Steel has no effect on the direction of DIGITAL CHOSUN i.e., DIGITAL CHOSUN and Han Kook go up and down completely randomly.
Pair Corralation between DIGITAL CHOSUN and Han Kook
Assuming the 90 days trading horizon DIGITAL CHOSUN is expected to generate 0.69 times more return on investment than Han Kook. However, DIGITAL CHOSUN is 1.45 times less risky than Han Kook. It trades about -0.01 of its potential returns per unit of risk. Han Kook Steel is currently generating about -0.03 per unit of risk. If you would invest 218,860 in DIGITAL CHOSUN on December 10, 2024 and sell it today you would lose (39,660) from holding DIGITAL CHOSUN or give up 18.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DIGITAL CHOSUN vs. Han Kook Steel
Performance |
| Timeline |
| DIGITAL CHOSUN |
| Han Kook Steel |
DIGITAL CHOSUN and Han Kook Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DIGITAL CHOSUN and Han Kook
The main advantage of trading using opposite DIGITAL CHOSUN and Han Kook positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DIGITAL CHOSUN position performs unexpectedly, Han Kook 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 Han Kook will offset losses from the drop in Han Kook's long position.| DIGITAL CHOSUN vs. Nice Information Telecommunication | DIGITAL CHOSUN vs. DB Insurance Co | DIGITAL CHOSUN vs. Hana Financial | DIGITAL CHOSUN vs. Ssangyong Information Communication |
| Han Kook vs. Koryo Credit Information | Han Kook vs. INFINITT Healthcare Co | Han Kook vs. Hana Financial | Han Kook vs. Incar Financial Service |
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.
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |