Correlation Between Dongyang and Humasis
Can any of the company-specific risk be diversified away by investing in both Dongyang and Humasis 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 Dongyang and Humasis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongyang EP and Humasis Co, you can compare the effects of market volatilities on Dongyang and Humasis 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 Dongyang with a short position of Humasis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongyang and Humasis.
Diversification Opportunities for Dongyang and Humasis
Weak diversification
The 3 months correlation between Dongyang and Humasis is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Dongyang EP and Humasis Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humasis and Dongyang 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 Dongyang EP are associated (or correlated) with Humasis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humasis has no effect on the direction of Dongyang i.e., Dongyang and Humasis go up and down completely randomly.
Pair Corralation between Dongyang and Humasis
Assuming the 90 days trading horizon Dongyang EP is expected to under-perform the Humasis. But the stock apears to be less risky and, when comparing its historical volatility, Dongyang EP is 5.15 times less risky than Humasis. The stock trades about -0.11 of its potential returns per unit of risk. The Humasis Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 173,400 in Humasis Co on November 3, 2024 and sell it today you would lose (3,100) from holding Humasis Co or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongyang EP vs. Humasis Co
Performance |
| Timeline |
| Dongyang EP |
| Humasis |
Dongyang and Humasis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongyang and Humasis
The main advantage of trading using opposite Dongyang and Humasis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongyang position performs unexpectedly, Humasis 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 Humasis will offset losses from the drop in Humasis' long position.| Dongyang vs. Korean Air Lines | Dongyang vs. Handok Clean Tech | Dongyang vs. Clean Science co | Dongyang vs. Seoul Food Industrial |
| Humasis vs. LabGenomics Co | Humasis vs. Seegene | Humasis vs. Access Bio | Humasis vs. Woori Technology 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |