Correlation Between Insung Information and DC Media
Can any of the company-specific risk be diversified away by investing in both Insung Information and DC 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 Insung Information and DC Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Insung Information Co and DC Media Co, you can compare the effects of market volatilities on Insung Information and DC 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 Insung Information with a short position of DC Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insung Information and DC Media.
Diversification Opportunities for Insung Information and DC Media
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Insung and 263720 is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Insung Information Co and DC Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DC Media and Insung Information 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 Insung Information Co are associated (or correlated) with DC Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DC Media has no effect on the direction of Insung Information i.e., Insung Information and DC Media go up and down completely randomly.
Pair Corralation between Insung Information and DC Media
Assuming the 90 days trading horizon Insung Information Co is expected to under-perform the DC Media. But the stock apears to be less risky and, when comparing its historical volatility, Insung Information Co is 1.36 times less risky than DC Media. The stock trades about -0.16 of its potential returns per unit of risk. The DC Media Co is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,790,000 in DC Media Co on August 31, 2024 and sell it today you would earn a total of 220,000 from holding DC Media Co or generate 12.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Insung Information Co vs. DC Media Co
Performance |
| Timeline |
| Insung Information |
| DC Media |
Insung Information and DC Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insung Information and DC Media
The main advantage of trading using opposite Insung Information and DC Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insung Information position performs unexpectedly, DC 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 DC Media will offset losses from the drop in DC Media's long position.| Insung Information vs. Dongsin Engineering Construction | Insung Information vs. Doosan Fuel Cell | Insung Information vs. Daishin Balance 1 | Insung Information vs. Total Soft Bank |
| DC Media vs. Display Tech Co | DC Media vs. Sangsin Energy Display | DC Media vs. CG Hi Tech | DC Media vs. Inzi Display CoLtd |
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.
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