Correlation Between Ewon Comfortech and Dong A
Can any of the company-specific risk be diversified away by investing in both Ewon Comfortech and Dong A 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 Ewon Comfortech and Dong A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ewon Comfortech Co and Dong A Eltek, you can compare the effects of market volatilities on Ewon Comfortech and Dong A 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 Ewon Comfortech with a short position of Dong A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ewon Comfortech and Dong A.
Diversification Opportunities for Ewon Comfortech and Dong A
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ewon and Dong is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ewon Comfortech Co and Dong A Eltek in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dong A Eltek and Ewon Comfortech 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 Ewon Comfortech Co are associated (or correlated) with Dong A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dong A Eltek has no effect on the direction of Ewon Comfortech i.e., Ewon Comfortech and Dong A go up and down completely randomly.
Pair Corralation between Ewon Comfortech and Dong A
Assuming the 90 days trading horizon Ewon Comfortech Co is expected to under-perform the Dong A. In addition to that, Ewon Comfortech is 1.16 times more volatile than Dong A Eltek. It trades about -0.19 of its total potential returns per unit of risk. Dong A Eltek is currently generating about -0.15 per unit of volatility. If you would invest 472,000 in Dong A Eltek on August 30, 2024 and sell it today you would lose (37,000) from holding Dong A Eltek or give up 7.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ewon Comfortech Co vs. Dong A Eltek
Performance |
| Timeline |
| Ewon Comfortech |
| Dong A Eltek |
Ewon Comfortech and Dong A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ewon Comfortech and Dong A
The main advantage of trading using opposite Ewon Comfortech and Dong A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ewon Comfortech position performs unexpectedly, Dong A 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 Dong A will offset losses from the drop in Dong A's long position.| Ewon Comfortech vs. KMH Hitech Co | Ewon Comfortech vs. GemVaxKAEL CoLtd | Ewon Comfortech vs. Busan Industrial Co | Ewon Comfortech vs. Busan Ind |
| Dong A vs. DataSolution | Dong A vs. Lotte Data Communication | Dong A vs. Hankuk Steel Wire | Dong A vs. Shinsegae Information Communication |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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