Correlation Between Daehan Steel and TOPMATERIAL
Can any of the company-specific risk be diversified away by investing in both Daehan Steel and TOPMATERIAL 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 Daehan Steel and TOPMATERIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daehan Steel and TOPMATERIAL LTD, you can compare the effects of market volatilities on Daehan Steel and TOPMATERIAL 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 Daehan Steel with a short position of TOPMATERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daehan Steel and TOPMATERIAL.
Diversification Opportunities for Daehan Steel and TOPMATERIAL
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Daehan and TOPMATERIAL is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Daehan Steel and TOPMATERIAL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOPMATERIAL LTD and Daehan Steel 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 Daehan Steel are associated (or correlated) with TOPMATERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOPMATERIAL LTD has no effect on the direction of Daehan Steel i.e., Daehan Steel and TOPMATERIAL go up and down completely randomly.
Pair Corralation between Daehan Steel and TOPMATERIAL
Assuming the 90 days trading horizon Daehan Steel is expected to generate 0.63 times more return on investment than TOPMATERIAL. However, Daehan Steel is 1.59 times less risky than TOPMATERIAL. It trades about 0.2 of its potential returns per unit of risk. TOPMATERIAL LTD is currently generating about -0.2 per unit of risk. If you would invest 1,256,000 in Daehan Steel on September 2, 2024 and sell it today you would earn a total of 295,000 from holding Daehan Steel or generate 23.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daehan Steel vs. TOPMATERIAL LTD
Performance |
| Timeline |
| Daehan Steel |
| TOPMATERIAL LTD |
Daehan Steel and TOPMATERIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daehan Steel and TOPMATERIAL
The main advantage of trading using opposite Daehan Steel and TOPMATERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daehan Steel position performs unexpectedly, TOPMATERIAL 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 TOPMATERIAL will offset losses from the drop in TOPMATERIAL's long position.| Daehan Steel vs. LG Chemicals | Daehan Steel vs. POSCO Holdings | Daehan Steel vs. Hanwha Solutions | Daehan Steel vs. Hyundai Steel |
| TOPMATERIAL vs. Samsung Electronics Co | TOPMATERIAL vs. Samsung Electronics Co | TOPMATERIAL vs. LG Energy Solution | TOPMATERIAL vs. SK Hynix |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |