Correlation Between Young Poong and DB Insurance
Can any of the company-specific risk be diversified away by investing in both Young Poong and DB Insurance 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 Young Poong and DB Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Young Poong Precision and DB Insurance Co, you can compare the effects of market volatilities on Young Poong and DB Insurance 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 Young Poong with a short position of DB Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Young Poong and DB Insurance.
Diversification Opportunities for Young Poong and DB Insurance
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Young and 005830 is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Young Poong Precision and DB Insurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Insurance and Young Poong 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 Young Poong Precision are associated (or correlated) with DB Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Insurance has no effect on the direction of Young Poong i.e., Young Poong and DB Insurance go up and down completely randomly.
Pair Corralation between Young Poong and DB Insurance
Assuming the 90 days trading horizon Young Poong Precision is expected to generate 2.74 times more return on investment than DB Insurance. However, Young Poong is 2.74 times more volatile than DB Insurance Co. It trades about 0.05 of its potential returns per unit of risk. DB Insurance Co is currently generating about 0.03 per unit of risk. If you would invest 1,195,000 in Young Poong Precision on September 3, 2024 and sell it today you would earn a total of 220,000 from holding Young Poong Precision or generate 18.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Young Poong Precision vs. DB Insurance Co
Performance |
| Timeline |
| Young Poong Precision |
| DB Insurance |
Young Poong and DB Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Young Poong and DB Insurance
The main advantage of trading using opposite Young Poong and DB Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Young Poong position performs unexpectedly, DB Insurance 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 DB Insurance will offset losses from the drop in DB Insurance's long position.| Young Poong vs. Aprogen Healthcare Games | Young Poong vs. Shinsung Delta Tech | Young Poong vs. PH Tech Co | Young Poong vs. Youngchang Chemical Co |
| DB Insurance vs. Playgram Co | DB Insurance vs. National Plastic Co | DB Insurance vs. Grand Korea Leisure | DB Insurance vs. EV Advanced Material |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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