Correlation Between ITM Semiconductor and Dongwon System
Can any of the company-specific risk be diversified away by investing in both ITM Semiconductor and Dongwon System 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 ITM Semiconductor and Dongwon System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ITM Semiconductor Co and Dongwon System, you can compare the effects of market volatilities on ITM Semiconductor and Dongwon System 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 ITM Semiconductor with a short position of Dongwon System. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITM Semiconductor and Dongwon System.
Diversification Opportunities for ITM Semiconductor and Dongwon System
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between ITM and Dongwon is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding ITM Semiconductor Co and Dongwon System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwon System and ITM Semiconductor 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 ITM Semiconductor Co are associated (or correlated) with Dongwon System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwon System has no effect on the direction of ITM Semiconductor i.e., ITM Semiconductor and Dongwon System go up and down completely randomly.
Pair Corralation between ITM Semiconductor and Dongwon System
Assuming the 90 days trading horizon ITM Semiconductor Co is expected to under-perform the Dongwon System. In addition to that, ITM Semiconductor is 1.03 times more volatile than Dongwon System. It trades about -0.03 of its total potential returns per unit of risk. Dongwon System is currently generating about 0.02 per unit of volatility. If you would invest 4,138,930 in Dongwon System on September 13, 2024 and sell it today you would earn a total of 111,070 from holding Dongwon System or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ITM Semiconductor Co vs. Dongwon System
Performance |
| Timeline |
| ITM Semiconductor |
| Dongwon System |
ITM Semiconductor and Dongwon System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITM Semiconductor and Dongwon System
The main advantage of trading using opposite ITM Semiconductor and Dongwon System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITM Semiconductor position performs unexpectedly, Dongwon System 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 Dongwon System will offset losses from the drop in Dongwon System's long position.| ITM Semiconductor vs. SK Hynix | ITM Semiconductor vs. People Technology | ITM Semiconductor vs. Hana Materials | ITM Semiconductor vs. SIMMTECH Co |
| Dongwon System vs. ABOV Semiconductor Co | Dongwon System vs. BGF Retail Co | Dongwon System vs. Seoul Semiconductor Co | Dongwon System vs. ITM Semiconductor 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 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.
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