Correlation Between Osang Healthcare and Dongil Technology
Can any of the company-specific risk be diversified away by investing in both Osang Healthcare and Dongil Technology 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 Osang Healthcare and Dongil Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Osang Healthcare Co,Ltd and Dongil Technology, you can compare the effects of market volatilities on Osang Healthcare and Dongil Technology 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 Osang Healthcare with a short position of Dongil Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Osang Healthcare and Dongil Technology.
Diversification Opportunities for Osang Healthcare and Dongil Technology
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Osang and Dongil is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Osang Healthcare Co,Ltd and Dongil Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongil Technology and Osang Healthcare 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 Osang Healthcare Co,Ltd are associated (or correlated) with Dongil Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongil Technology has no effect on the direction of Osang Healthcare i.e., Osang Healthcare and Dongil Technology go up and down completely randomly.
Pair Corralation between Osang Healthcare and Dongil Technology
Assuming the 90 days trading horizon Osang Healthcare Co,Ltd is expected to under-perform the Dongil Technology. In addition to that, Osang Healthcare is 2.54 times more volatile than Dongil Technology. It trades about -0.24 of its total potential returns per unit of risk. Dongil Technology is currently generating about -0.23 per unit of volatility. If you would invest 1,103,000 in Dongil Technology on August 26, 2024 and sell it today you would lose (47,000) from holding Dongil Technology or give up 4.26% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Osang Healthcare Co,Ltd vs. Dongil Technology
Performance |
Timeline |
Osang Healthcare Co,Ltd |
Dongil Technology |
Osang Healthcare and Dongil Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Osang Healthcare and Dongil Technology
The main advantage of trading using opposite Osang Healthcare and Dongil Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Osang Healthcare position performs unexpectedly, Dongil Technology 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 Dongil Technology will offset losses from the drop in Dongil Technology's long position.Osang Healthcare vs. Heungkuk Metaltech CoLtd | Osang Healthcare vs. Seoul Semiconductor Co | Osang Healthcare vs. Polaris Office Corp | Osang Healthcare vs. Lotte Chilsung Beverage |
Dongil Technology vs. Korea Real Estate | Dongil Technology vs. Korea Ratings Co | Dongil Technology vs. IQuest Co | Dongil Technology vs. Wonbang Tech Co |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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