Correlation Between Duksan Hi and Grand Korea
Can any of the company-specific risk be diversified away by investing in both Duksan Hi and Grand Korea 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 Grand Korea 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 Grand Korea Leisure, you can compare the effects of market volatilities on Duksan Hi and Grand Korea 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 Grand Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duksan Hi and Grand Korea.
Diversification Opportunities for Duksan Hi and Grand Korea
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Duksan and Grand is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Duksan Hi Metal and Grand Korea Leisure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Korea Leisure 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 Grand Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Korea Leisure has no effect on the direction of Duksan Hi i.e., Duksan Hi and Grand Korea go up and down completely randomly.
Pair Corralation between Duksan Hi and Grand Korea
Assuming the 90 days trading horizon Duksan Hi Metal is expected to under-perform the Grand Korea. In addition to that, Duksan Hi is 1.59 times more volatile than Grand Korea Leisure. It trades about -0.3 of its total potential returns per unit of risk. Grand Korea Leisure is currently generating about 0.06 per unit of volatility. If you would invest 1,146,000 in Grand Korea Leisure on September 1, 2024 and sell it today you would earn a total of 26,000 from holding Grand Korea Leisure or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duksan Hi Metal vs. Grand Korea Leisure
Performance |
| Timeline |
| Duksan Hi Metal |
| Grand Korea Leisure |
Duksan Hi and Grand Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duksan Hi and Grand Korea
The main advantage of trading using opposite Duksan Hi and Grand Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duksan Hi position performs unexpectedly, Grand Korea 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 Grand Korea will offset losses from the drop in Grand Korea's long position.| Duksan Hi vs. Daiyang Metal Co | Duksan Hi vs. PJ Metal Co | Duksan Hi vs. Dongbang Transport Logistics | Duksan Hi vs. Nasmedia Co |
| Grand Korea vs. Cots Technology Co | Grand Korea vs. RFTech Co | Grand Korea vs. Shinhan Inverse Silver | Grand Korea vs. Vitzro Tech 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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