Correlation Between Dongkuk Structures and Samwha Electronics
Can any of the company-specific risk be diversified away by investing in both Dongkuk Structures and Samwha Electronics 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 Dongkuk Structures and Samwha Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongkuk Structures Construction and Samwha Electronics Co, you can compare the effects of market volatilities on Dongkuk Structures and Samwha Electronics 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 Dongkuk Structures with a short position of Samwha Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongkuk Structures and Samwha Electronics.
Diversification Opportunities for Dongkuk Structures and Samwha Electronics
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dongkuk and Samwha is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Dongkuk Structures Constructio and Samwha Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samwha Electronics and Dongkuk Structures 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 Dongkuk Structures Construction are associated (or correlated) with Samwha Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samwha Electronics has no effect on the direction of Dongkuk Structures i.e., Dongkuk Structures and Samwha Electronics go up and down completely randomly.
Pair Corralation between Dongkuk Structures and Samwha Electronics
Assuming the 90 days trading horizon Dongkuk Structures Construction is expected to under-perform the Samwha Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Dongkuk Structures Construction is 2.25 times less risky than Samwha Electronics. The stock trades about -0.04 of its potential returns per unit of risk. The Samwha Electronics Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 270,501 in Samwha Electronics Co on October 14, 2024 and sell it today you would earn a total of 81,999 from holding Samwha Electronics Co or generate 30.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Dongkuk Structures Constructio vs. Samwha Electronics Co
Performance |
| Timeline |
| Dongkuk Structures |
| Samwha Electronics |
Dongkuk Structures and Samwha Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongkuk Structures and Samwha Electronics
The main advantage of trading using opposite Dongkuk Structures and Samwha Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongkuk Structures position performs unexpectedly, Samwha Electronics 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 Samwha Electronics will offset losses from the drop in Samwha Electronics' long position.| Dongkuk Structures vs. Dong A Steel Technology | Dongkuk Structures vs. Eagle Veterinary Technology | Dongkuk Structures vs. Hyundai Engineering Construction | Dongkuk Structures vs. Eugene Technology CoLtd |
| Samwha Electronics vs. KEPCO Engineering Construction | Samwha Electronics vs. Dongkuk Structures Construction | Samwha Electronics vs. Cuckoo Electronics Co | Samwha Electronics vs. Hannong Chemicals |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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