Correlation Between Daewon Media and Sangsangin Investment
Can any of the company-specific risk be diversified away by investing in both Daewon Media and Sangsangin Investment 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 Daewon Media and Sangsangin Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daewon Media Co and Sangsangin Investment Securities, you can compare the effects of market volatilities on Daewon Media and Sangsangin Investment 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 Daewon Media with a short position of Sangsangin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewon Media and Sangsangin Investment.
Diversification Opportunities for Daewon Media and Sangsangin Investment
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daewon and Sangsangin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Daewon Media Co and Sangsangin Investment Securiti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sangsangin Investment and Daewon Media 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 Daewon Media Co are associated (or correlated) with Sangsangin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sangsangin Investment has no effect on the direction of Daewon Media i.e., Daewon Media and Sangsangin Investment go up and down completely randomly.
Pair Corralation between Daewon Media and Sangsangin Investment
Assuming the 90 days trading horizon Daewon Media Co is expected to generate 1.12 times more return on investment than Sangsangin Investment. However, Daewon Media is 1.12 times more volatile than Sangsangin Investment Securities. It trades about 0.13 of its potential returns per unit of risk. Sangsangin Investment Securities is currently generating about 0.02 per unit of risk. If you would invest 746,000 in Daewon Media Co on September 19, 2024 and sell it today you would earn a total of 42,000 from holding Daewon Media Co or generate 5.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewon Media Co vs. Sangsangin Investment Securiti
Performance |
| Timeline |
| Daewon Media |
| Sangsangin Investment |
Daewon Media and Sangsangin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewon Media and Sangsangin Investment
The main advantage of trading using opposite Daewon Media and Sangsangin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewon Media position performs unexpectedly, Sangsangin Investment 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 Sangsangin Investment will offset losses from the drop in Sangsangin Investment's long position.| Daewon Media vs. Eugene Investment Securities | Daewon Media vs. DSC Investment | Daewon Media vs. Shinsegae Information Communication | Daewon Media vs. Daishin Information Communications |
| Sangsangin Investment vs. KB Financial Group | Sangsangin Investment vs. Shinhan Financial Group | Sangsangin Investment vs. Hana Financial | Sangsangin Investment vs. Woori Financial Group |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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