Correlation Between Duksan Hi and COWINTECH
Can any of the company-specific risk be diversified away by investing in both Duksan Hi and COWINTECH 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 COWINTECH 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 COWINTECH Co, you can compare the effects of market volatilities on Duksan Hi and COWINTECH 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 COWINTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duksan Hi and COWINTECH.
Diversification Opportunities for Duksan Hi and COWINTECH
Modest diversification
The 3 months correlation between Duksan and COWINTECH is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Duksan Hi Metal and COWINTECH Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COWINTECH 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 COWINTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COWINTECH has no effect on the direction of Duksan Hi i.e., Duksan Hi and COWINTECH go up and down completely randomly.
Pair Corralation between Duksan Hi and COWINTECH
Assuming the 90 days trading horizon Duksan Hi Metal is expected to under-perform the COWINTECH. But the stock apears to be less risky and, when comparing its historical volatility, Duksan Hi Metal is 2.15 times less risky than COWINTECH. The stock trades about -0.22 of its potential returns per unit of risk. The COWINTECH Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,520,000 in COWINTECH Co on August 30, 2024 and sell it today you would lose (75,000) from holding COWINTECH Co or give up 4.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duksan Hi Metal vs. COWINTECH Co
Performance |
| Timeline |
| Duksan Hi Metal |
| COWINTECH |
Duksan Hi and COWINTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duksan Hi and COWINTECH
The main advantage of trading using opposite Duksan Hi and COWINTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duksan Hi position performs unexpectedly, COWINTECH 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 COWINTECH will offset losses from the drop in COWINTECH'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 |
| COWINTECH vs. EV Advanced Material | COWINTECH vs. Hankukpackage Co | COWINTECH vs. National Plastic Co | COWINTECH vs. Hyosung Advanced Materials |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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