Correlation Between SEOWONINTECHCoLtd and DONGKUK TED
Can any of the company-specific risk be diversified away by investing in both SEOWONINTECHCoLtd and DONGKUK TED 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 SEOWONINTECHCoLtd and DONGKUK TED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEOWONINTECHCoLtd and DONGKUK TED METAL, you can compare the effects of market volatilities on SEOWONINTECHCoLtd and DONGKUK TED 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 SEOWONINTECHCoLtd with a short position of DONGKUK TED. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEOWONINTECHCoLtd and DONGKUK TED.
Diversification Opportunities for SEOWONINTECHCoLtd and DONGKUK TED
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SEOWONINTECHCoLtd and DONGKUK is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding SEOWONINTECHCoLtd and DONGKUK TED METAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DONGKUK TED METAL and SEOWONINTECHCoLtd 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 SEOWONINTECHCoLtd are associated (or correlated) with DONGKUK TED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DONGKUK TED METAL has no effect on the direction of SEOWONINTECHCoLtd i.e., SEOWONINTECHCoLtd and DONGKUK TED go up and down completely randomly.
Pair Corralation between SEOWONINTECHCoLtd and DONGKUK TED
Assuming the 90 days trading horizon SEOWONINTECHCoLtd is expected to under-perform the DONGKUK TED. But the stock apears to be less risky and, when comparing its historical volatility, SEOWONINTECHCoLtd is 1.67 times less risky than DONGKUK TED. The stock trades about -0.35 of its potential returns per unit of risk. The DONGKUK TED METAL is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest 626,000 in DONGKUK TED METAL on November 7, 2024 and sell it today you would lose (19,000) from holding DONGKUK TED METAL or give up 3.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEOWONINTECHCoLtd vs. DONGKUK TED METAL
Performance |
| Timeline |
| SEOWONINTECHCoLtd |
| DONGKUK TED METAL |
SEOWONINTECHCoLtd and DONGKUK TED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEOWONINTECHCoLtd and DONGKUK TED
The main advantage of trading using opposite SEOWONINTECHCoLtd and DONGKUK TED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEOWONINTECHCoLtd position performs unexpectedly, DONGKUK TED 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 DONGKUK TED will offset losses from the drop in DONGKUK TED's long position.| SEOWONINTECHCoLtd vs. Daiyang Metal Co | SEOWONINTECHCoLtd vs. Kukil Metal Co | SEOWONINTECHCoLtd vs. Daejung Chemicals Metals | SEOWONINTECHCoLtd vs. Hyundai Industrial Co |
| DONGKUK TED vs. Jin Air Co | DONGKUK TED vs. Cloud Air CoLtd | DONGKUK TED vs. Nable Communications | DONGKUK TED vs. Nice Information Telecommunication |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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