Correlation Between Daejoo Electronic and CS BEARING
Can any of the company-specific risk be diversified away by investing in both Daejoo Electronic and CS BEARING 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 CS BEARING 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 CS BEARING CoLtd, you can compare the effects of market volatilities on Daejoo Electronic and CS BEARING 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 CS BEARING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daejoo Electronic and CS BEARING.
Diversification Opportunities for Daejoo Electronic and CS BEARING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Daejoo and 297090 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Daejoo Electronic Materials and CS BEARING CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CS BEARING CoLtd 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 CS BEARING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CS BEARING CoLtd has no effect on the direction of Daejoo Electronic i.e., Daejoo Electronic and CS BEARING go up and down completely randomly.
Pair Corralation between Daejoo Electronic and CS BEARING
If you would invest (100.00) in CS BEARING CoLtd on September 5, 2024 and sell it today you would earn a total of 100.00 from holding CS BEARING CoLtd or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Daejoo Electronic Materials vs. CS BEARING CoLtd
Performance |
| Timeline |
| Daejoo Electronic |
| CS BEARING CoLtd |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Daejoo Electronic and CS BEARING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daejoo Electronic and CS BEARING
The main advantage of trading using opposite Daejoo Electronic and CS BEARING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daejoo Electronic position performs unexpectedly, CS BEARING 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 CS BEARING will offset losses from the drop in CS BEARING's long position.The idea behind Daejoo Electronic Materials and CS BEARING CoLtd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| CS BEARING vs. Hanwha InvestmentSecurities Co | CS BEARING vs. Daelim Trading Co | CS BEARING vs. Samyung Trading Co | CS BEARING vs. Coloray International Investment |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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