Correlation Between Dongbang Ship and Shinhan WTI
Can any of the company-specific risk be diversified away by investing in both Dongbang Ship and Shinhan WTI 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 Dongbang Ship and Shinhan WTI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongbang Ship Machinery and Shinhan WTI Futures, you can compare the effects of market volatilities on Dongbang Ship and Shinhan WTI 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 Dongbang Ship with a short position of Shinhan WTI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongbang Ship and Shinhan WTI.
Diversification Opportunities for Dongbang Ship and Shinhan WTI
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dongbang and Shinhan is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Dongbang Ship Machinery and Shinhan WTI Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinhan WTI Futures and Dongbang Ship 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 Dongbang Ship Machinery are associated (or correlated) with Shinhan WTI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinhan WTI Futures has no effect on the direction of Dongbang Ship i.e., Dongbang Ship and Shinhan WTI go up and down completely randomly.
Pair Corralation between Dongbang Ship and Shinhan WTI
Assuming the 90 days trading horizon Dongbang Ship Machinery is expected to generate 1.6 times more return on investment than Shinhan WTI. However, Dongbang Ship is 1.6 times more volatile than Shinhan WTI Futures. It trades about 0.05 of its potential returns per unit of risk. Shinhan WTI Futures is currently generating about 0.0 per unit of risk. If you would invest 229,500 in Dongbang Ship Machinery on September 1, 2024 and sell it today you would earn a total of 51,500 from holding Dongbang Ship Machinery or generate 22.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.8% |
| Values | Daily Returns |
Dongbang Ship Machinery vs. Shinhan WTI Futures
Performance |
| Timeline |
| Dongbang Ship Machinery |
| Shinhan WTI Futures |
Dongbang Ship and Shinhan WTI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongbang Ship and Shinhan WTI
The main advantage of trading using opposite Dongbang Ship and Shinhan WTI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongbang Ship position performs unexpectedly, Shinhan WTI 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 Shinhan WTI will offset losses from the drop in Shinhan WTI's long position.| Dongbang Ship vs. Korea New Network | Dongbang Ship vs. ICD Co | Dongbang Ship vs. DYPNF CoLtd | Dongbang Ship vs. Busan Industrial Co |
| Shinhan WTI vs. Kaonmedia Co | Shinhan WTI vs. YG Entertainment | Shinhan WTI vs. Dongil Metal Co | Shinhan WTI vs. DONGKUK TED METAL |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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