Correlation Between Sewoon Medical and DC Media
Can any of the company-specific risk be diversified away by investing in both Sewoon Medical and DC Media 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 Sewoon Medical and DC Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sewoon Medical Co and DC Media Co, you can compare the effects of market volatilities on Sewoon Medical and DC Media 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 Sewoon Medical with a short position of DC Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sewoon Medical and DC Media.
Diversification Opportunities for Sewoon Medical and DC Media
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sewoon and 263720 is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Sewoon Medical Co and DC Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DC Media and Sewoon Medical 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 Sewoon Medical Co are associated (or correlated) with DC Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DC Media has no effect on the direction of Sewoon Medical i.e., Sewoon Medical and DC Media go up and down completely randomly.
Pair Corralation between Sewoon Medical and DC Media
Assuming the 90 days trading horizon Sewoon Medical is expected to generate 1.21 times less return on investment than DC Media. But when comparing it to its historical volatility, Sewoon Medical Co is 1.45 times less risky than DC Media. It trades about 0.11 of its potential returns per unit of risk. DC Media Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,794,000 in DC Media Co on November 29, 2024 and sell it today you would earn a total of 37,000 from holding DC Media Co or generate 2.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Sewoon Medical Co vs. DC Media Co
Performance |
| Timeline |
| Sewoon Medical |
| DC Media |
Sewoon Medical and DC Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sewoon Medical and DC Media
The main advantage of trading using opposite Sewoon Medical and DC Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sewoon Medical position performs unexpectedly, DC Media 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 DC Media will offset losses from the drop in DC Media's long position.| Sewoon Medical vs. Samyang Foods Co | Sewoon Medical vs. Mirai Semiconductors Co | Sewoon Medical vs. Samyung Trading Co | Sewoon Medical vs. EBEST Investment Securities |
| DC Media vs. PJ Electronics Co | DC Media vs. Keyang Electric Machinery | DC Media vs. Daeduck Electronics Co | DC Media vs. Seohee Construction Co |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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