Correlation Between Daewon Media and Samsung SDI
Can any of the company-specific risk be diversified away by investing in both Daewon Media and Samsung SDI 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 Samsung SDI 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 Samsung SDI, you can compare the effects of market volatilities on Daewon Media and Samsung SDI 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 Samsung SDI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewon Media and Samsung SDI.
Diversification Opportunities for Daewon Media and Samsung SDI
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Daewon and Samsung is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Daewon Media Co and Samsung SDI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung SDI 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 Samsung SDI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung SDI has no effect on the direction of Daewon Media i.e., Daewon Media and Samsung SDI go up and down completely randomly.
Pair Corralation between Daewon Media and Samsung SDI
Assuming the 90 days trading horizon Daewon Media Co is expected to generate 0.63 times more return on investment than Samsung SDI. However, Daewon Media Co is 1.6 times less risky than Samsung SDI. It trades about 0.03 of its potential returns per unit of risk. Samsung SDI is currently generating about -0.12 per unit of risk. If you would invest 870,531 in Daewon Media Co on December 4, 2024 and sell it today you would earn a total of 36,469 from holding Daewon Media Co or generate 4.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewon Media Co vs. Samsung SDI
Performance |
| Timeline |
| Daewon Media |
| Samsung SDI |
Daewon Media and Samsung SDI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewon Media and Samsung SDI
The main advantage of trading using opposite Daewon Media and Samsung SDI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewon Media position performs unexpectedly, Samsung SDI 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 Samsung SDI will offset losses from the drop in Samsung SDI's long position.| Daewon Media vs. Nice Information Telecommunication | Daewon Media vs. Insung Information Co | Daewon Media vs. Koryo Credit Information | Daewon Media vs. KCC Engineering Construction |
| Samsung SDI vs. Insung Information Co | Samsung SDI vs. SCI Information Service | Samsung SDI vs. Daou Data Corp | Samsung SDI vs. Hyundai Industrial 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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