Correlation Between JYP Entertainment and Duksan Hi
Can any of the company-specific risk be diversified away by investing in both JYP Entertainment and Duksan Hi 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 JYP Entertainment and Duksan Hi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JYP Entertainment Corp and Duksan Hi Metal, you can compare the effects of market volatilities on JYP Entertainment and Duksan Hi 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 JYP Entertainment with a short position of Duksan Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of JYP Entertainment and Duksan Hi.
Diversification Opportunities for JYP Entertainment and Duksan Hi
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between JYP and Duksan is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding JYP Entertainment Corp and Duksan Hi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duksan Hi Metal and JYP Entertainment 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 JYP Entertainment Corp are associated (or correlated) with Duksan Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duksan Hi Metal has no effect on the direction of JYP Entertainment i.e., JYP Entertainment and Duksan Hi go up and down completely randomly.
Pair Corralation between JYP Entertainment and Duksan Hi
Assuming the 90 days trading horizon JYP Entertainment Corp is expected to generate 1.52 times more return on investment than Duksan Hi. However, JYP Entertainment is 1.52 times more volatile than Duksan Hi Metal. It trades about 0.31 of its potential returns per unit of risk. Duksan Hi Metal is currently generating about -0.18 per unit of risk. If you would invest 6,720,000 in JYP Entertainment Corp on November 7, 2024 and sell it today you would earn a total of 1,190,000 from holding JYP Entertainment Corp or generate 17.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
JYP Entertainment Corp vs. Duksan Hi Metal
Performance |
| Timeline |
| JYP Entertainment Corp |
| Duksan Hi Metal |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
JYP Entertainment and Duksan Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JYP Entertainment and Duksan Hi
The main advantage of trading using opposite JYP Entertainment and Duksan Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JYP Entertainment position performs unexpectedly, Duksan Hi 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 Duksan Hi will offset losses from the drop in Duksan Hi's long position.| JYP Entertainment vs. PH Tech Co | JYP Entertainment vs. Samsung Life Insurance | JYP Entertainment vs. Ssangyong Materials Corp | JYP Entertainment vs. Samick Musical Instruments |
| Duksan Hi vs. Genie Music | Duksan Hi vs. Polaris Office Corp | Duksan Hi vs. SK Chemicals Co | Duksan Hi vs. Ssangyong Materials Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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