Correlation Between DAEYANG ELECTRICCoLtd and Samlip General
Can any of the company-specific risk be diversified away by investing in both DAEYANG ELECTRICCoLtd and Samlip General 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 DAEYANG ELECTRICCoLtd and Samlip General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DAEYANG ELECTRICCoLtd and Samlip General Foods, you can compare the effects of market volatilities on DAEYANG ELECTRICCoLtd and Samlip General 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 DAEYANG ELECTRICCoLtd with a short position of Samlip General. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAEYANG ELECTRICCoLtd and Samlip General.
Diversification Opportunities for DAEYANG ELECTRICCoLtd and Samlip General
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between DAEYANG and Samlip is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding DAEYANG ELECTRICCoLtd and Samlip General Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samlip General Foods and DAEYANG ELECTRICCoLtd 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 DAEYANG ELECTRICCoLtd are associated (or correlated) with Samlip General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samlip General Foods has no effect on the direction of DAEYANG ELECTRICCoLtd i.e., DAEYANG ELECTRICCoLtd and Samlip General go up and down completely randomly.
Pair Corralation between DAEYANG ELECTRICCoLtd and Samlip General
Assuming the 90 days trading horizon DAEYANG ELECTRICCoLtd is expected to generate 1.62 times more return on investment than Samlip General. However, DAEYANG ELECTRICCoLtd is 1.62 times more volatile than Samlip General Foods. It trades about 0.02 of its potential returns per unit of risk. Samlip General Foods is currently generating about -0.06 per unit of risk. If you would invest 1,200,000 in DAEYANG ELECTRICCoLtd on September 3, 2024 and sell it today you would earn a total of 86,000 from holding DAEYANG ELECTRICCoLtd or generate 7.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAEYANG ELECTRICCoLtd vs. Samlip General Foods
Performance |
| Timeline |
| DAEYANG ELECTRICCoLtd |
| Samlip General Foods |
DAEYANG ELECTRICCoLtd and Samlip General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DAEYANG ELECTRICCoLtd and Samlip General
The main advantage of trading using opposite DAEYANG ELECTRICCoLtd and Samlip General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAEYANG ELECTRICCoLtd position performs unexpectedly, Samlip General 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 Samlip General will offset losses from the drop in Samlip General's long position.| DAEYANG ELECTRICCoLtd vs. LG Display | DAEYANG ELECTRICCoLtd vs. Hyundai Motor | DAEYANG ELECTRICCoLtd vs. Hyundai Motor Co | DAEYANG ELECTRICCoLtd vs. Hyundai Motor Co |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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