Correlation Between DHP Korea and Mobile Appliance
Can any of the company-specific risk be diversified away by investing in both DHP Korea and Mobile Appliance 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 DHP Korea and Mobile Appliance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DHP Korea Co and Mobile Appliance, you can compare the effects of market volatilities on DHP Korea and Mobile Appliance 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 DHP Korea with a short position of Mobile Appliance. Check out your portfolio center. Please also check ongoing floating volatility patterns of DHP Korea and Mobile Appliance.
Diversification Opportunities for DHP Korea and Mobile Appliance
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DHP and Mobile is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding DHP Korea Co and Mobile Appliance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Appliance and DHP 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 DHP Korea Co are associated (or correlated) with Mobile Appliance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Appliance has no effect on the direction of DHP Korea i.e., DHP Korea and Mobile Appliance go up and down completely randomly.
Pair Corralation between DHP Korea and Mobile Appliance
Assuming the 90 days trading horizon DHP Korea Co is expected to under-perform the Mobile Appliance. But the stock apears to be less risky and, when comparing its historical volatility, DHP Korea Co is 1.47 times less risky than Mobile Appliance. The stock trades about -0.08 of its potential returns per unit of risk. The Mobile Appliance is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 210,000 in Mobile Appliance on September 13, 2024 and sell it today you would lose (9,000) from holding Mobile Appliance or give up 4.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DHP Korea Co vs. Mobile Appliance
Performance |
| Timeline |
| DHP Korea |
| Mobile Appliance |
DHP Korea and Mobile Appliance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DHP Korea and Mobile Appliance
The main advantage of trading using opposite DHP Korea and Mobile Appliance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DHP Korea position performs unexpectedly, Mobile Appliance 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 Mobile Appliance will offset losses from the drop in Mobile Appliance's long position.| DHP Korea vs. Humasis Co | DHP Korea vs. Access Bio | DHP Korea vs. DRGEM | DHP Korea vs. Busan Industrial Co |
| Mobile Appliance vs. Samsung Electronics Co | Mobile Appliance vs. Samsung Electronics Co | Mobile Appliance vs. LG Energy Solution | Mobile Appliance vs. SK Hynix |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |