Correlation Between Digital Imaging and Korea Industrial
Can any of the company-specific risk be diversified away by investing in both Digital Imaging and Korea Industrial 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 Digital Imaging and Korea Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Imaging Technology and Korea Industrial Co, you can compare the effects of market volatilities on Digital Imaging and Korea Industrial 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 Digital Imaging with a short position of Korea Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Imaging and Korea Industrial.
Diversification Opportunities for Digital Imaging and Korea Industrial
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Digital and Korea is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Digital Imaging Technology and Korea Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Industrial and Digital Imaging 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 Digital Imaging Technology are associated (or correlated) with Korea Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Industrial has no effect on the direction of Digital Imaging i.e., Digital Imaging and Korea Industrial go up and down completely randomly.
Pair Corralation between Digital Imaging and Korea Industrial
Assuming the 90 days trading horizon Digital Imaging Technology is expected to generate 2.9 times more return on investment than Korea Industrial. However, Digital Imaging is 2.9 times more volatile than Korea Industrial Co. It trades about 0.26 of its potential returns per unit of risk. Korea Industrial Co is currently generating about 0.27 per unit of risk. If you would invest 1,342,000 in Digital Imaging Technology on November 9, 2024 and sell it today you would earn a total of 363,000 from holding Digital Imaging Technology or generate 27.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital Imaging Technology vs. Korea Industrial Co
Performance |
| Timeline |
| Digital Imaging Tech |
| Korea Industrial |
Digital Imaging and Korea Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Imaging and Korea Industrial
The main advantage of trading using opposite Digital Imaging and Korea Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Imaging position performs unexpectedly, Korea Industrial 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 Industrial will offset losses from the drop in Korea Industrial's long position.| Digital Imaging vs. SK Hynix | Digital Imaging vs. LX Semicon Co | Digital Imaging vs. Tokai Carbon Korea | Digital Imaging vs. People Technology |
| Korea Industrial vs. TJ media Co | Korea Industrial vs. NH Investment Securities | Korea Industrial vs. Barunson Entertainment Arts | Korea Industrial vs. SKONEC Entertainment 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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