Correlation Between Daejoo Electronic and Amogreentech
Can any of the company-specific risk be diversified away by investing in both Daejoo Electronic and Amogreentech 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 Daejoo Electronic and Amogreentech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daejoo Electronic Materials and Amogreentech Co, you can compare the effects of market volatilities on Daejoo Electronic and Amogreentech 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 Daejoo Electronic with a short position of Amogreentech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daejoo Electronic and Amogreentech.
Diversification Opportunities for Daejoo Electronic and Amogreentech
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daejoo and Amogreentech is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Daejoo Electronic Materials and Amogreentech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amogreentech and Daejoo Electronic 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 Daejoo Electronic Materials are associated (or correlated) with Amogreentech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amogreentech has no effect on the direction of Daejoo Electronic i.e., Daejoo Electronic and Amogreentech go up and down completely randomly.
Pair Corralation between Daejoo Electronic and Amogreentech
Assuming the 90 days trading horizon Daejoo Electronic Materials is expected to under-perform the Amogreentech. But the stock apears to be less risky and, when comparing its historical volatility, Daejoo Electronic Materials is 1.1 times less risky than Amogreentech. The stock trades about -0.26 of its potential returns per unit of risk. The Amogreentech Co is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 709,000 in Amogreentech Co on August 29, 2024 and sell it today you would lose (42,000) from holding Amogreentech Co or give up 5.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daejoo Electronic Materials vs. Amogreentech Co
Performance |
| Timeline |
| Daejoo Electronic |
| Amogreentech |
Daejoo Electronic and Amogreentech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daejoo Electronic and Amogreentech
The main advantage of trading using opposite Daejoo Electronic and Amogreentech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daejoo Electronic position performs unexpectedly, Amogreentech 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 Amogreentech will offset losses from the drop in Amogreentech's long position.| Daejoo Electronic vs. Korea Real Estate | Daejoo Electronic vs. Korea Ratings Co | Daejoo Electronic vs. IQuest Co | Daejoo Electronic vs. Wonbang 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |