Correlation Between Total Soft and Duksan Hi
Can any of the company-specific risk be diversified away by investing in both Total Soft 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 Total Soft and Duksan Hi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Total Soft Bank and Duksan Hi Metal, you can compare the effects of market volatilities on Total Soft 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 Total Soft with a short position of Duksan Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Soft and Duksan Hi.
Diversification Opportunities for Total Soft and Duksan Hi
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Total and Duksan is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Total Soft Bank 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 Total Soft 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 Total Soft Bank 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 Total Soft i.e., Total Soft and Duksan Hi go up and down completely randomly.
Pair Corralation between Total Soft and Duksan Hi
Assuming the 90 days trading horizon Total Soft Bank is expected to under-perform the Duksan Hi. In addition to that, Total Soft is 1.36 times more volatile than Duksan Hi Metal. It trades about -0.55 of its total potential returns per unit of risk. Duksan Hi Metal is currently generating about -0.18 per unit of volatility. If you would invest 412,000 in Duksan Hi Metal on November 5, 2024 and sell it today you would lose (24,500) from holding Duksan Hi Metal or give up 5.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Total Soft Bank vs. Duksan Hi Metal
Performance |
| Timeline |
| Total Soft Bank |
| Duksan Hi Metal |
Total Soft and Duksan Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Total Soft and Duksan Hi
The main advantage of trading using opposite Total Soft and Duksan Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Total Soft 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.| Total Soft vs. Nable Communications | Total Soft vs. Lake Materials Co | Total Soft vs. Korea Information Communications | Total Soft vs. ECSTELECOM Co |
| Duksan Hi vs. Samlip General Foods | Duksan Hi vs. Dongwoo Farm To | Duksan Hi vs. Korea Alcohol Industrial | Duksan Hi vs. Woorim Machinery 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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