Correlation Between Grand Korea and Duksan Hi
Can any of the company-specific risk be diversified away by investing in both Grand Korea and Duksan Hi 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 Grand Korea and Duksan Hi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Korea Leisure and Duksan Hi Metal, you can compare the effects of market volatilities on Grand Korea and Duksan Hi 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 Grand Korea with a short position of Duksan Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Korea and Duksan Hi.
Diversification Opportunities for Grand Korea and Duksan Hi
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Grand and Duksan is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Grand Korea Leisure and Duksan Hi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duksan Hi Metal and Grand Korea 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 Grand Korea Leisure are associated (or correlated) with Duksan Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duksan Hi Metal has no effect on the direction of Grand Korea i.e., Grand Korea and Duksan Hi go up and down completely randomly.
Pair Corralation between Grand Korea and Duksan Hi
Assuming the 90 days trading horizon Grand Korea Leisure is expected to generate 0.63 times more return on investment than Duksan Hi. However, Grand Korea Leisure is 1.59 times less risky than Duksan Hi. It trades about 0.06 of its potential returns per unit of risk. Duksan Hi Metal is currently generating about -0.3 per unit of risk. If you would invest 1,146,000 in Grand Korea Leisure on September 1, 2024 and sell it today you would earn a total of 26,000 from holding Grand Korea Leisure or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Korea Leisure vs. Duksan Hi Metal
Performance |
| Timeline |
| Grand Korea Leisure |
| Duksan Hi Metal |
Grand Korea and Duksan Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Korea and Duksan Hi
The main advantage of trading using opposite Grand Korea and Duksan Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Korea position performs unexpectedly, Duksan Hi 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 Duksan Hi will offset losses from the drop in Duksan Hi's long position.| Grand Korea vs. Cots Technology Co | Grand Korea vs. RFTech Co | Grand Korea vs. Shinhan Inverse Silver | Grand Korea vs. Vitzro Tech Co |
| Duksan Hi vs. Daiyang Metal Co | Duksan Hi vs. PJ Metal Co | Duksan Hi vs. Dongbang Transport Logistics | Duksan Hi vs. Nasmedia 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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