Correlation Between Dongwoo Farm and HYUNDAI FEED
Can any of the company-specific risk be diversified away by investing in both Dongwoo Farm and HYUNDAI FEED 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 Dongwoo Farm and HYUNDAI FEED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongwoo Farm To and HYUNDAI FEED, you can compare the effects of market volatilities on Dongwoo Farm and HYUNDAI FEED 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 Dongwoo Farm with a short position of HYUNDAI FEED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongwoo Farm and HYUNDAI FEED.
Diversification Opportunities for Dongwoo Farm and HYUNDAI FEED
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dongwoo and HYUNDAI is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Dongwoo Farm To and HYUNDAI FEED in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYUNDAI FEED and Dongwoo Farm 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 Dongwoo Farm To are associated (or correlated) with HYUNDAI FEED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYUNDAI FEED has no effect on the direction of Dongwoo Farm i.e., Dongwoo Farm and HYUNDAI FEED go up and down completely randomly.
Pair Corralation between Dongwoo Farm and HYUNDAI FEED
Assuming the 90 days trading horizon Dongwoo Farm To is expected to generate 0.3 times more return on investment than HYUNDAI FEED. However, Dongwoo Farm To is 3.33 times less risky than HYUNDAI FEED. It trades about -0.15 of its potential returns per unit of risk. HYUNDAI FEED is currently generating about -0.14 per unit of risk. If you would invest 297,000 in Dongwoo Farm To on August 25, 2024 and sell it today you would lose (108,300) from holding Dongwoo Farm To or give up 36.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.17% |
| Values | Daily Returns |
Dongwoo Farm To vs. HYUNDAI FEED
Performance |
| Timeline |
| Dongwoo Farm To |
| HYUNDAI FEED |
Dongwoo Farm and HYUNDAI FEED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongwoo Farm and HYUNDAI FEED
The main advantage of trading using opposite Dongwoo Farm and HYUNDAI FEED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongwoo Farm position performs unexpectedly, HYUNDAI FEED 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 HYUNDAI FEED will offset losses from the drop in HYUNDAI FEED's long position.| Dongwoo Farm vs. Maeil Dairies Co | Dongwoo Farm vs. HYUNDAI FEED | Dongwoo Farm vs. Wooyang Co | Dongwoo Farm vs. Asia Seed CoLtd |
| HYUNDAI FEED vs. Maeil Dairies Co | HYUNDAI FEED vs. Dongwoo Farm To | HYUNDAI FEED vs. Wooyang Co | HYUNDAI FEED vs. Asia Seed CoLtd |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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