Correlation Between Dong A and Samsung Publishing
Can any of the company-specific risk be diversified away by investing in both Dong A and Samsung Publishing 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 Samsung Publishing 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 Samsung Publishing Co, you can compare the effects of market volatilities on Dong A and Samsung Publishing 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 Samsung Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dong A and Samsung Publishing.
Diversification Opportunities for Dong A and Samsung Publishing
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dong and Samsung is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Dong A Steel Technology and Samsung Publishing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Publishing 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 Samsung Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Publishing has no effect on the direction of Dong A i.e., Dong A and Samsung Publishing go up and down completely randomly.
Pair Corralation between Dong A and Samsung Publishing
Assuming the 90 days trading horizon Dong A Steel Technology is expected to generate 0.76 times more return on investment than Samsung Publishing. However, Dong A Steel Technology is 1.31 times less risky than Samsung Publishing. It trades about -0.01 of its potential returns per unit of risk. Samsung Publishing Co is currently generating about -0.02 per unit of risk. If you would invest 477,000 in Dong A Steel Technology on August 28, 2024 and sell it today you would lose (123,500) from holding Dong A Steel Technology or give up 25.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dong A Steel Technology vs. Samsung Publishing Co
Performance |
| Timeline |
| Dong A Steel |
| Samsung Publishing |
Dong A and Samsung Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dong A and Samsung Publishing
The main advantage of trading using opposite Dong A and Samsung Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dong A position performs unexpectedly, Samsung Publishing 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 Publishing will offset losses from the drop in Samsung Publishing's long position.| Dong A vs. AptaBio Therapeutics | Dong A vs. Daewoo SBI SPAC | Dong A vs. Dream Security co | Dong A vs. Microfriend |
| Samsung Publishing vs. AptaBio Therapeutics | Samsung Publishing vs. Daewoo SBI SPAC | Samsung Publishing vs. Dream Security co | Samsung Publishing vs. Microfriend |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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