Correlation Between Dongil Metal and Daou Technology
Can any of the company-specific risk be diversified away by investing in both Dongil Metal and Daou Technology 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 Daou Technology 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 Daou Technology, you can compare the effects of market volatilities on Dongil Metal and Daou Technology 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 Daou Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongil Metal and Daou Technology.
Diversification Opportunities for Dongil Metal and Daou Technology
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dongil and Daou is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Dongil Metal Co and Daou Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daou Technology 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 Daou Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daou Technology has no effect on the direction of Dongil Metal i.e., Dongil Metal and Daou Technology go up and down completely randomly.
Pair Corralation between Dongil Metal and Daou Technology
Assuming the 90 days trading horizon Dongil Metal Co is expected to under-perform the Daou Technology. But the stock apears to be less risky and, when comparing its historical volatility, Dongil Metal Co is 1.47 times less risky than Daou Technology. The stock trades about -0.04 of its potential returns per unit of risk. The Daou Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,663,421 in Daou Technology on October 30, 2024 and sell it today you would earn a total of 125,579 from holding Daou Technology or generate 7.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongil Metal Co vs. Daou Technology
Performance |
| Timeline |
| Dongil Metal |
| Daou Technology |
Dongil Metal and Daou Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongil Metal and Daou Technology
The main advantage of trading using opposite Dongil Metal and Daou Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongil Metal position performs unexpectedly, Daou Technology 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 Daou Technology will offset losses from the drop in Daou Technology's long position.| Dongil Metal vs. Jinro Distillers Co | Dongil Metal vs. Heungkuk Metaltech CoLtd | Dongil Metal vs. Kbi Metal Co | Dongil Metal vs. Innowireless Co |
| Daou Technology vs. Kisan Telecom Co | Daou Technology vs. MetaLabs Co | Daou Technology vs. SK Telecom Co | Daou Technology vs. Daiyang Metal 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |