Correlation Between Sungchang Autotech and Daou Data
Can any of the company-specific risk be diversified away by investing in both Sungchang Autotech and Daou Data 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 Sungchang Autotech and Daou Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungchang Autotech Co and Daou Data Corp, you can compare the effects of market volatilities on Sungchang Autotech and Daou Data 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 Sungchang Autotech with a short position of Daou Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungchang Autotech and Daou Data.
Diversification Opportunities for Sungchang Autotech and Daou Data
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sungchang and Daou is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Sungchang Autotech Co and Daou Data Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daou Data Corp and Sungchang Autotech 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 Sungchang Autotech Co are associated (or correlated) with Daou Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daou Data Corp has no effect on the direction of Sungchang Autotech i.e., Sungchang Autotech and Daou Data go up and down completely randomly.
Pair Corralation between Sungchang Autotech and Daou Data
Assuming the 90 days trading horizon Sungchang Autotech Co is expected to under-perform the Daou Data. In addition to that, Sungchang Autotech is 1.57 times more volatile than Daou Data Corp. It trades about -0.06 of its total potential returns per unit of risk. Daou Data Corp is currently generating about 0.02 per unit of volatility. If you would invest 1,073,000 in Daou Data Corp on September 2, 2024 and sell it today you would earn a total of 8,000 from holding Daou Data Corp or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sungchang Autotech Co vs. Daou Data Corp
Performance |
| Timeline |
| Sungchang Autotech |
| Daou Data Corp |
Sungchang Autotech and Daou Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungchang Autotech and Daou Data
The main advantage of trading using opposite Sungchang Autotech and Daou Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungchang Autotech position performs unexpectedly, Daou Data 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 Daou Data will offset losses from the drop in Daou Data's long position.| Sungchang Autotech vs. LG Display | Sungchang Autotech vs. Hyundai Motor Co | Sungchang Autotech vs. Hyundai Motor Co | Sungchang Autotech vs. Adaptive Plasma Technology |
| Daou Data vs. Samsung Electronics Co | Daou Data vs. Samsung Electronics Co | Daou Data vs. KB Financial Group | Daou Data vs. Shinhan Financial Group |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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