Correlation Between Dongil Metal and Korea Shipbuilding
Can any of the company-specific risk be diversified away by investing in both Dongil Metal and Korea Shipbuilding 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 Korea Shipbuilding 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 Korea Shipbuilding Offshore, you can compare the effects of market volatilities on Dongil Metal and Korea Shipbuilding 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 Korea Shipbuilding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongil Metal and Korea Shipbuilding.
Diversification Opportunities for Dongil Metal and Korea Shipbuilding
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Dongil and Korea is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Dongil Metal Co and Korea Shipbuilding Offshore in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Shipbuilding 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 Korea Shipbuilding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Shipbuilding has no effect on the direction of Dongil Metal i.e., Dongil Metal and Korea Shipbuilding go up and down completely randomly.
Pair Corralation between Dongil Metal and Korea Shipbuilding
Assuming the 90 days trading horizon Dongil Metal Co is expected to generate 1.13 times more return on investment than Korea Shipbuilding. However, Dongil Metal is 1.13 times more volatile than Korea Shipbuilding Offshore. It trades about 0.48 of its potential returns per unit of risk. Korea Shipbuilding Offshore is currently generating about 0.22 per unit of risk. If you would invest 751,598 in Dongil Metal Co on October 24, 2024 and sell it today you would earn a total of 163,402 from holding Dongil Metal Co or generate 21.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongil Metal Co vs. Korea Shipbuilding Offshore
Performance |
| Timeline |
| Dongil Metal |
| Korea Shipbuilding |
Dongil Metal and Korea Shipbuilding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongil Metal and Korea Shipbuilding
The main advantage of trading using opposite Dongil Metal and Korea Shipbuilding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongil Metal position performs unexpectedly, Korea Shipbuilding 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 Korea Shipbuilding will offset losses from the drop in Korea Shipbuilding's long position.| Dongil Metal vs. Alton Sports CoLtd | Dongil Metal vs. PlayD Co | Dongil Metal vs. YG Entertainment | Dongil Metal vs. T3 Entertainment Co |
| Korea Shipbuilding vs. Dongil Metal Co | Korea Shipbuilding vs. Heungkuk Metaltech CoLtd | Korea Shipbuilding vs. Wireless Power Amplifier | Korea Shipbuilding vs. Mobileleader CoLtd |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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