Correlation Between Alton Sports and Dream Security
Can any of the company-specific risk be diversified away by investing in both Alton Sports and Dream Security 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 Dream Security 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 Dream Security co, you can compare the effects of market volatilities on Alton Sports and Dream Security 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 Dream Security. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alton Sports and Dream Security.
Diversification Opportunities for Alton Sports and Dream Security
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Alton and Dream is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Alton Sports CoLtd and Dream Security co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dream Security co 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 Dream Security. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dream Security co has no effect on the direction of Alton Sports i.e., Alton Sports and Dream Security go up and down completely randomly.
Pair Corralation between Alton Sports and Dream Security
Assuming the 90 days trading horizon Alton Sports CoLtd is expected to generate 0.27 times more return on investment than Dream Security. However, Alton Sports CoLtd is 3.65 times less risky than Dream Security. It trades about 0.33 of its potential returns per unit of risk. Dream Security co is currently generating about -0.29 per unit of risk. If you would invest 145,300 in Alton Sports CoLtd on November 5, 2024 and sell it today you would earn a total of 8,700 from holding Alton Sports CoLtd or generate 5.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alton Sports CoLtd vs. Dream Security co
Performance |
| Timeline |
| Alton Sports CoLtd |
| Dream Security co |
Alton Sports and Dream Security Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alton Sports and Dream Security
The main advantage of trading using opposite Alton Sports and Dream Security positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alton Sports position performs unexpectedly, Dream Security 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 Dream Security will offset losses from the drop in Dream Security's long position.| Alton Sports vs. KTB Investment Securities | Alton Sports vs. Sam Yang Foods | Alton Sports vs. Daol Investment Securities | Alton Sports vs. Woori Technology Investment |
| Dream Security vs. Shinhan Inverse Copper | Dream Security vs. Leaders Technology Investment | Dream Security vs. Youngsin Metal Industrial | Dream Security vs. Kbi 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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