Correlation Between Koryo Credit and Daou Technology
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and Daou Technology 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 Koryo Credit and Daou Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koryo Credit Information and Daou Technology, you can compare the effects of market volatilities on Koryo Credit and Daou Technology 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 Koryo Credit with a short position of Daou Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and Daou Technology.
Diversification Opportunities for Koryo Credit and Daou Technology
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Koryo and Daou is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and Daou Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daou Technology and Koryo Credit 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 Koryo Credit Information are associated (or correlated) with Daou Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daou Technology has no effect on the direction of Koryo Credit i.e., Koryo Credit and Daou Technology go up and down completely randomly.
Pair Corralation between Koryo Credit and Daou Technology
Assuming the 90 days trading horizon Koryo Credit is expected to generate 10.67 times less return on investment than Daou Technology. But when comparing it to its historical volatility, Koryo Credit Information is 4.6 times less risky than Daou Technology. It trades about 0.1 of its potential returns per unit of risk. Daou Technology is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,782,000 in Daou Technology on December 1, 2024 and sell it today you would earn a total of 243,000 from holding Daou Technology or generate 13.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. Daou Technology
Performance |
| Timeline |
| Koryo Credit Information |
| Daou Technology |
Koryo Credit and Daou Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and Daou Technology
The main advantage of trading using opposite Koryo Credit and Daou Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, Daou Technology 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 Daou Technology will offset losses from the drop in Daou Technology's long position.| Koryo Credit vs. Woorim Machinery Co | Koryo Credit vs. Golden Bridge Investment | Koryo Credit vs. Seoam Machinery Industry | Koryo Credit vs. KCC Engineering Construction |
| Daou Technology vs. Jin Air Co | Daou Technology vs. Sempio Foods Co | Daou Technology vs. Husteel | Daou Technology vs. Jeju Air 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 Stocks Directory module to find actively traded stocks across global markets.
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