Correlation Between Daewon Media and Doosan Fuel
Can any of the company-specific risk be diversified away by investing in both Daewon Media and Doosan Fuel 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 Doosan Fuel 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 Doosan Fuel Cell, you can compare the effects of market volatilities on Daewon Media and Doosan Fuel 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 Doosan Fuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewon Media and Doosan Fuel.
Diversification Opportunities for Daewon Media and Doosan Fuel
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daewon and Doosan is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Daewon Media Co and Doosan Fuel Cell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doosan Fuel Cell 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 Doosan Fuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doosan Fuel Cell has no effect on the direction of Daewon Media i.e., Daewon Media and Doosan Fuel go up and down completely randomly.
Pair Corralation between Daewon Media and Doosan Fuel
Assuming the 90 days trading horizon Daewon Media is expected to generate 54.59 times less return on investment than Doosan Fuel. But when comparing it to its historical volatility, Daewon Media Co is 2.59 times less risky than Doosan Fuel. It trades about 0.01 of its potential returns per unit of risk. Doosan Fuel Cell is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,542,000 in Doosan Fuel Cell on September 13, 2024 and sell it today you would earn a total of 177,000 from holding Doosan Fuel Cell or generate 11.48% 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. Doosan Fuel Cell
Performance |
| Timeline |
| Daewon Media |
| Doosan Fuel Cell |
Daewon Media and Doosan Fuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewon Media and Doosan Fuel
The main advantage of trading using opposite Daewon Media and Doosan Fuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewon Media position performs unexpectedly, Doosan Fuel 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 Doosan Fuel will offset losses from the drop in Doosan Fuel's long position.| Daewon Media vs. YG Entertainment | Daewon Media vs. JYP Entertainment | Daewon Media vs. Cube Entertainment | Daewon Media vs. FNC Entertainment Co |
| Doosan Fuel vs. ABCO Electronics Co | Doosan Fuel vs. UJU Electronics Co | Doosan Fuel vs. Sungwoo Electronics Co | Doosan Fuel vs. Wireless Power Amplifier |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |