Correlation Between Daejung Chemicals and TS Investment
Can any of the company-specific risk be diversified away by investing in both Daejung Chemicals and TS Investment 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 Daejung Chemicals and TS Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daejung Chemicals Metals and TS Investment Corp, you can compare the effects of market volatilities on Daejung Chemicals and TS Investment 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 Daejung Chemicals with a short position of TS Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daejung Chemicals and TS Investment.
Diversification Opportunities for Daejung Chemicals and TS Investment
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daejung and 246690 is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Daejung Chemicals Metals and TS Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TS Investment Corp and Daejung Chemicals 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 Daejung Chemicals Metals are associated (or correlated) with TS Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TS Investment Corp has no effect on the direction of Daejung Chemicals i.e., Daejung Chemicals and TS Investment go up and down completely randomly.
Pair Corralation between Daejung Chemicals and TS Investment
Assuming the 90 days trading horizon Daejung Chemicals Metals is expected to under-perform the TS Investment. But the stock apears to be less risky and, when comparing its historical volatility, Daejung Chemicals Metals is 1.61 times less risky than TS Investment. The stock trades about -0.08 of its potential returns per unit of risk. The TS Investment Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 97,200 in TS Investment Corp on November 4, 2024 and sell it today you would earn a total of 0.00 from holding TS Investment Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daejung Chemicals Metals vs. TS Investment Corp
Performance |
| Timeline |
| Daejung Chemicals Metals |
| TS Investment Corp |
Daejung Chemicals and TS Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daejung Chemicals and TS Investment
The main advantage of trading using opposite Daejung Chemicals and TS Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daejung Chemicals position performs unexpectedly, TS Investment 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 TS Investment will offset losses from the drop in TS Investment's long position.| Daejung Chemicals vs. Heungkuk Metaltech CoLtd | Daejung Chemicals vs. Iljin Display | Daejung Chemicals vs. Duksan Hi Metal | Daejung Chemicals vs. Formetal Co |
| TS Investment vs. Samyang Foods Co | TS Investment vs. Ssangyong Information Communication | TS Investment vs. SBI Investment KOREA | TS Investment vs. EBEST Investment Securities |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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