Correlation Between Daewon Media and Narae Nanotech
Can any of the company-specific risk be diversified away by investing in both Daewon Media and Narae Nanotech 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 Narae Nanotech 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 Narae Nanotech Corp, you can compare the effects of market volatilities on Daewon Media and Narae Nanotech 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 Narae Nanotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewon Media and Narae Nanotech.
Diversification Opportunities for Daewon Media and Narae Nanotech
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daewon and Narae is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Daewon Media Co and Narae Nanotech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Narae Nanotech Corp 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 Narae Nanotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Narae Nanotech Corp has no effect on the direction of Daewon Media i.e., Daewon Media and Narae Nanotech go up and down completely randomly.
Pair Corralation between Daewon Media and Narae Nanotech
Assuming the 90 days trading horizon Daewon Media Co is expected to generate 0.58 times more return on investment than Narae Nanotech. However, Daewon Media Co is 1.73 times less risky than Narae Nanotech. It trades about 0.28 of its potential returns per unit of risk. Narae Nanotech Corp is currently generating about 0.11 per unit of risk. If you would invest 755,052 in Daewon Media Co on October 13, 2024 and sell it today you would earn a total of 117,948 from holding Daewon Media Co or generate 15.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewon Media Co vs. Narae Nanotech Corp
Performance |
| Timeline |
| Daewon Media |
| Narae Nanotech Corp |
Daewon Media and Narae Nanotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewon Media and Narae Nanotech
The main advantage of trading using opposite Daewon Media and Narae Nanotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewon Media position performs unexpectedly, Narae Nanotech 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 Narae Nanotech will offset losses from the drop in Narae Nanotech's long position.| Daewon Media vs. Alton Sports CoLtd | Daewon Media vs. CKH Food Health | Daewon Media vs. Choil Aluminum | Daewon Media vs. Youngsin Metal Industrial |
| Narae Nanotech vs. MEDIANA CoLtd | Narae Nanotech vs. Barunson Entertainment Arts | Narae Nanotech vs. Heungkuk Metaltech CoLtd | Narae Nanotech vs. Daewon Media 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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