Correlation Between Dongil Metal and Tae Kyung
Can any of the company-specific risk be diversified away by investing in both Dongil Metal and Tae Kyung 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 Dongil Metal and Tae Kyung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongil Metal Co and Tae Kyung Chemical, you can compare the effects of market volatilities on Dongil Metal and Tae Kyung 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 Dongil Metal with a short position of Tae Kyung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongil Metal and Tae Kyung.
Diversification Opportunities for Dongil Metal and Tae Kyung
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dongil and Tae is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Dongil Metal Co and Tae Kyung Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tae Kyung Chemical and Dongil Metal 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 Dongil Metal Co are associated (or correlated) with Tae Kyung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tae Kyung Chemical has no effect on the direction of Dongil Metal i.e., Dongil Metal and Tae Kyung go up and down completely randomly.
Pair Corralation between Dongil Metal and Tae Kyung
Assuming the 90 days trading horizon Dongil Metal Co is expected to under-perform the Tae Kyung. In addition to that, Dongil Metal is 1.24 times more volatile than Tae Kyung Chemical. It trades about -0.07 of its total potential returns per unit of risk. Tae Kyung Chemical is currently generating about 0.01 per unit of volatility. If you would invest 1,127,580 in Tae Kyung Chemical on October 11, 2024 and sell it today you would lose (22,580) from holding Tae Kyung Chemical or give up 2.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.51% |
| Values | Daily Returns |
Dongil Metal Co vs. Tae Kyung Chemical
Performance |
| Timeline |
| Dongil Metal |
| Tae Kyung Chemical |
Dongil Metal and Tae Kyung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongil Metal and Tae Kyung
The main advantage of trading using opposite Dongil Metal and Tae Kyung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongil Metal position performs unexpectedly, Tae Kyung 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 Tae Kyung will offset losses from the drop in Tae Kyung's long position.| Dongil Metal vs. Sungchang Autotech Co | Dongil Metal vs. A Tech Solution Co | Dongil Metal vs. Woori Financial Group | Dongil Metal vs. Pureun Mutual Savings |
| Tae Kyung vs. Dongil Metal Co | Tae Kyung vs. Eagon Industrial Co | Tae Kyung vs. INNOX Advanced Materials | Tae Kyung vs. Ssangyong Materials Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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