Correlation Between NewFlex Technology and Dongsin Engineering

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both NewFlex Technology and Dongsin Engineering 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 NewFlex Technology and Dongsin Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NewFlex Technology Co and Dongsin Engineering Construction, you can compare the effects of market volatilities on NewFlex Technology and Dongsin Engineering 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 NewFlex Technology with a short position of Dongsin Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of NewFlex Technology and Dongsin Engineering.

Diversification Opportunities for NewFlex Technology and Dongsin Engineering

0.19
  Correlation Coefficient

Average diversification

The 3 months correlation between NewFlex and Dongsin is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding NewFlex Technology Co and Dongsin Engineering Constructi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongsin Engineering and NewFlex Technology 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 NewFlex Technology Co are associated (or correlated) with Dongsin Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongsin Engineering has no effect on the direction of NewFlex Technology i.e., NewFlex Technology and Dongsin Engineering go up and down completely randomly.

Pair Corralation between NewFlex Technology and Dongsin Engineering

Assuming the 90 days trading horizon NewFlex Technology Co is expected to under-perform the Dongsin Engineering. But the stock apears to be less risky and, when comparing its historical volatility, NewFlex Technology Co is 1.23 times less risky than Dongsin Engineering. The stock trades about 0.0 of its potential returns per unit of risk. The Dongsin Engineering Construction is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,440,536  in Dongsin Engineering Construction on September 3, 2024 and sell it today you would earn a total of  481,464  from holding Dongsin Engineering Construction or generate 33.42% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

NewFlex Technology Co  vs.  Dongsin Engineering Constructi

 Performance 
       Timeline  
NewFlex Technology 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days NewFlex Technology Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, NewFlex Technology is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Dongsin Engineering 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Dongsin Engineering Construction are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Dongsin Engineering sustained solid returns over the last few months and may actually be approaching a breakup point.

NewFlex Technology and Dongsin Engineering Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with NewFlex Technology and Dongsin Engineering

The main advantage of trading using opposite NewFlex Technology and Dongsin Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NewFlex Technology position performs unexpectedly, Dongsin Engineering 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 Dongsin Engineering will offset losses from the drop in Dongsin Engineering's long position.
The idea behind NewFlex Technology Co and Dongsin Engineering Construction 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.
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.

Other Complementary Tools

Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Fundamental Analysis
View fundamental data based on most recent published financial statements
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Earnings Calls
Check upcoming earnings announcements updated hourly across public exchanges
Instant Ratings
Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance