Correlation Between Fine Besteel and Dongil Technology
Can any of the company-specific risk be diversified away by investing in both Fine Besteel and Dongil Technology 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 Fine Besteel and Dongil Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fine Besteel Co and Dongil Technology, you can compare the effects of market volatilities on Fine Besteel and Dongil Technology 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 Fine Besteel with a short position of Dongil Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fine Besteel and Dongil Technology.
Diversification Opportunities for Fine Besteel and Dongil Technology
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Fine and Dongil is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Fine Besteel Co and Dongil Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongil Technology and Fine Besteel 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 Fine Besteel Co are associated (or correlated) with Dongil Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongil Technology has no effect on the direction of Fine Besteel i.e., Fine Besteel and Dongil Technology go up and down completely randomly.
Pair Corralation between Fine Besteel and Dongil Technology
Assuming the 90 days trading horizon Fine Besteel Co is expected to generate 2.47 times more return on investment than Dongil Technology. However, Fine Besteel is 2.47 times more volatile than Dongil Technology. It trades about 0.0 of its potential returns per unit of risk. Dongil Technology is currently generating about -0.09 per unit of risk. If you would invest 111,500 in Fine Besteel Co on September 2, 2024 and sell it today you would lose (6,800) from holding Fine Besteel Co or give up 6.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fine Besteel Co vs. Dongil Technology
Performance |
| Timeline |
| Fine Besteel |
| Dongil Technology |
Fine Besteel and Dongil Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fine Besteel and Dongil Technology
The main advantage of trading using opposite Fine Besteel and Dongil Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fine Besteel position performs unexpectedly, Dongil Technology 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 Dongil Technology will offset losses from the drop in Dongil Technology's long position.| Fine Besteel vs. AptaBio Therapeutics | Fine Besteel vs. Daewoo SBI SPAC | Fine Besteel vs. Dream Security co | Fine Besteel vs. Microfriend |
| Dongil Technology vs. Dongsin Engineering Construction | Dongil Technology vs. Doosan Fuel Cell | Dongil Technology vs. Daishin Balance 1 | Dongil Technology vs. Total Soft Bank |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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