Correlation Between Alton Sports and Daelim Trading
Can any of the company-specific risk be diversified away by investing in both Alton Sports and Daelim Trading 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 Alton Sports and Daelim Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alton Sports CoLtd and Daelim Trading Co, you can compare the effects of market volatilities on Alton Sports and Daelim Trading 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 Alton Sports with a short position of Daelim Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alton Sports and Daelim Trading.
Diversification Opportunities for Alton Sports and Daelim Trading
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Alton and Daelim is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Alton Sports CoLtd and Daelim Trading Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daelim Trading and Alton Sports 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 Alton Sports CoLtd are associated (or correlated) with Daelim Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daelim Trading has no effect on the direction of Alton Sports i.e., Alton Sports and Daelim Trading go up and down completely randomly.
Pair Corralation between Alton Sports and Daelim Trading
Assuming the 90 days trading horizon Alton Sports CoLtd is expected to under-perform the Daelim Trading. In addition to that, Alton Sports is 1.12 times more volatile than Daelim Trading Co. It trades about -0.08 of its total potential returns per unit of risk. Daelim Trading Co is currently generating about -0.03 per unit of volatility. If you would invest 382,075 in Daelim Trading Co on October 14, 2024 and sell it today you would lose (121,075) from holding Daelim Trading Co or give up 31.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alton Sports CoLtd vs. Daelim Trading Co
Performance |
| Timeline |
| Alton Sports CoLtd |
| Daelim Trading |
Alton Sports and Daelim Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alton Sports and Daelim Trading
The main advantage of trading using opposite Alton Sports and Daelim Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alton Sports position performs unexpectedly, Daelim Trading 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 Daelim Trading will offset losses from the drop in Daelim Trading's long position.| Alton Sports vs. Green Cross Medical | Alton Sports vs. Haitai Confectionery Foods | Alton Sports vs. Sempio Foods Co | Alton Sports vs. Lotte Non Life Insurance |
| Daelim Trading vs. Jeong Moon Information | Daelim Trading vs. Nice Information Telecommunication | Daelim Trading vs. Alton Sports CoLtd | Daelim Trading vs. Hanshin Construction 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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