Correlation Between Duksan Hi and People Technology
Can any of the company-specific risk be diversified away by investing in both Duksan Hi and People 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 Duksan Hi and People Technology 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 People Technology, you can compare the effects of market volatilities on Duksan Hi and People 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 Duksan Hi with a short position of People Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duksan Hi and People Technology.
Diversification Opportunities for Duksan Hi and People Technology
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Duksan and People is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Duksan Hi Metal and People Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on People Technology 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 People Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of People Technology has no effect on the direction of Duksan Hi i.e., Duksan Hi and People Technology go up and down completely randomly.
Pair Corralation between Duksan Hi and People Technology
Assuming the 90 days trading horizon Duksan Hi Metal is expected to under-perform the People Technology. But the stock apears to be less risky and, when comparing its historical volatility, Duksan Hi Metal is 1.81 times less risky than People Technology. The stock trades about -0.18 of its potential returns per unit of risk. The People Technology is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 4,010,000 in People Technology on November 7, 2024 and sell it today you would lose (195,000) from holding People Technology or give up 4.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Duksan Hi Metal vs. People Technology
Performance |
| Timeline |
| Duksan Hi Metal |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| People Technology |
Duksan Hi and People Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duksan Hi and People Technology
The main advantage of trading using opposite Duksan Hi and People Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duksan Hi position performs unexpectedly, People 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 People Technology will offset losses from the drop in People Technology's long position.| Duksan Hi vs. Genie Music | Duksan Hi vs. Polaris Office Corp | Duksan Hi vs. SK Chemicals Co | Duksan Hi vs. Ssangyong Materials Corp |
| People Technology vs. SH Energy Chemical | People Technology vs. Hanwha Chemical Corp | People Technology vs. Vina Technology Co | People Technology vs. Cuckoo Electronics 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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