Correlation Between Dong A and Yura Tech
Can any of the company-specific risk be diversified away by investing in both Dong A and Yura Tech 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 Dong A and Yura Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dong A Steel Technology and Yura Tech Co, you can compare the effects of market volatilities on Dong A and Yura Tech 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 Dong A with a short position of Yura Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dong A and Yura Tech.
Diversification Opportunities for Dong A and Yura Tech
Good diversification
The 3 months correlation between Dong and Yura is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Dong A Steel Technology and Yura Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yura Tech and Dong A 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 Dong A Steel Technology are associated (or correlated) with Yura Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yura Tech has no effect on the direction of Dong A i.e., Dong A and Yura Tech go up and down completely randomly.
Pair Corralation between Dong A and Yura Tech
Assuming the 90 days trading horizon Dong A Steel Technology is expected to generate 2.65 times more return on investment than Yura Tech. However, Dong A is 2.65 times more volatile than Yura Tech Co. It trades about 0.03 of its potential returns per unit of risk. Yura Tech Co is currently generating about -0.09 per unit of risk. If you would invest 340,000 in Dong A Steel Technology on August 28, 2024 and sell it today you would earn a total of 13,500 from holding Dong A Steel Technology or generate 3.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dong A Steel Technology vs. Yura Tech Co
Performance |
| Timeline |
| Dong A Steel |
| Yura Tech |
Dong A and Yura Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dong A and Yura Tech
The main advantage of trading using opposite Dong A and Yura Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dong A position performs unexpectedly, Yura Tech 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 Yura Tech will offset losses from the drop in Yura Tech's long position.| Dong A vs. AptaBio Therapeutics | Dong A vs. Daewoo SBI SPAC | Dong A vs. Dream Security co | Dong A vs. Microfriend |
| Yura Tech vs. Busan Industrial Co | Yura Tech vs. Busan Ind | Yura Tech vs. Mirae Asset Daewoo | Yura Tech vs. UNISEM 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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