Correlation Between Insung Information and DONGKUK TED
Can any of the company-specific risk be diversified away by investing in both Insung Information and DONGKUK TED 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 DONGKUK TED 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 DONGKUK TED METAL, you can compare the effects of market volatilities on Insung Information and DONGKUK TED 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 DONGKUK TED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insung Information and DONGKUK TED.
Diversification Opportunities for Insung Information and DONGKUK TED
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Insung and DONGKUK is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Insung Information Co and DONGKUK TED METAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DONGKUK TED METAL 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 DONGKUK TED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DONGKUK TED METAL has no effect on the direction of Insung Information i.e., Insung Information and DONGKUK TED go up and down completely randomly.
Pair Corralation between Insung Information and DONGKUK TED
Assuming the 90 days trading horizon Insung Information Co is expected to under-perform the DONGKUK TED. In addition to that, Insung Information is 1.61 times more volatile than DONGKUK TED METAL. It trades about -0.11 of its total potential returns per unit of risk. DONGKUK TED METAL is currently generating about -0.1 per unit of volatility. If you would invest 635,000 in DONGKUK TED METAL on August 26, 2024 and sell it today you would lose (24,000) from holding DONGKUK TED METAL or give up 3.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Insung Information Co vs. DONGKUK TED METAL
Performance |
| Timeline |
| Insung Information |
| DONGKUK TED METAL |
Insung Information and DONGKUK TED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insung Information and DONGKUK TED
The main advantage of trading using opposite Insung Information and DONGKUK TED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insung Information position performs unexpectedly, DONGKUK TED 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 DONGKUK TED will offset losses from the drop in DONGKUK TED's long position.| Insung Information vs. DataSolution | Insung Information vs. Miwon Chemicals Co | Insung Information vs. Daou Data Corp | Insung Information vs. Kukdong Oil Chemicals |
| DONGKUK TED vs. Samsung Electronics Co | DONGKUK TED vs. Samsung Electronics Co | DONGKUK TED vs. LG Energy Solution | DONGKUK TED vs. SK Hynix |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Stocks Directory Find actively traded stocks across global markets |