Correlation Between Duksan Hi and Wonbang Tech
Can any of the company-specific risk be diversified away by investing in both Duksan Hi and Wonbang 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 Duksan Hi and Wonbang Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Duksan Hi Metal and Wonbang Tech Co, you can compare the effects of market volatilities on Duksan Hi and Wonbang 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 Duksan Hi with a short position of Wonbang Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duksan Hi and Wonbang Tech.
Diversification Opportunities for Duksan Hi and Wonbang Tech
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Duksan and Wonbang is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Duksan Hi Metal and Wonbang Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonbang Tech and Duksan Hi 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 Duksan Hi Metal are associated (or correlated) with Wonbang Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonbang Tech has no effect on the direction of Duksan Hi i.e., Duksan Hi and Wonbang Tech go up and down completely randomly.
Pair Corralation between Duksan Hi and Wonbang Tech
Assuming the 90 days trading horizon Duksan Hi Metal is expected to under-perform the Wonbang Tech. In addition to that, Duksan Hi is 1.09 times more volatile than Wonbang Tech Co. It trades about -0.24 of its total potential returns per unit of risk. Wonbang Tech Co is currently generating about -0.22 per unit of volatility. If you would invest 1,550,000 in Wonbang Tech Co on August 30, 2024 and sell it today you would lose (204,000) from holding Wonbang Tech Co or give up 13.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duksan Hi Metal vs. Wonbang Tech Co
Performance |
| Timeline |
| Duksan Hi Metal |
| Wonbang Tech |
Duksan Hi and Wonbang Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duksan Hi and Wonbang Tech
The main advantage of trading using opposite Duksan Hi and Wonbang Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duksan Hi position performs unexpectedly, Wonbang 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 Wonbang Tech will offset losses from the drop in Wonbang Tech's long position.| Duksan Hi vs. Daou Data Corp | Duksan Hi vs. Busan Industrial Co | Duksan Hi vs. Busan Ind | Duksan Hi vs. Shinhan WTI Futures |
| Wonbang Tech vs. Nasmedia Co | Wonbang Tech vs. EBEST Investment Securities | Wonbang Tech vs. Korea Investment Holdings | Wonbang Tech vs. Alton Sports CoLtd |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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