Correlation Between Fine Besteel and Dongwoo Farm
Can any of the company-specific risk be diversified away by investing in both Fine Besteel and Dongwoo Farm 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 Dongwoo Farm 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 Dongwoo Farm To, you can compare the effects of market volatilities on Fine Besteel and Dongwoo Farm 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 Dongwoo Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fine Besteel and Dongwoo Farm.
Diversification Opportunities for Fine Besteel and Dongwoo Farm
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fine and Dongwoo is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Fine Besteel Co and Dongwoo Farm To in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwoo Farm To 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 Dongwoo Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwoo Farm To has no effect on the direction of Fine Besteel i.e., Fine Besteel and Dongwoo Farm go up and down completely randomly.
Pair Corralation between Fine Besteel and Dongwoo Farm
Assuming the 90 days trading horizon Fine Besteel Co is expected to generate 2.25 times more return on investment than Dongwoo Farm. However, Fine Besteel is 2.25 times more volatile than Dongwoo Farm To. It trades about -0.01 of its potential returns per unit of risk. Dongwoo Farm To is currently generating about -0.11 per unit of risk. If you would invest 123,400 in Fine Besteel Co on September 1, 2024 and sell it today you would lose (18,700) from holding Fine Besteel Co or give up 15.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.62% |
| Values | Daily Returns |
Fine Besteel Co vs. Dongwoo Farm To
Performance |
| Timeline |
| Fine Besteel |
| Dongwoo Farm To |
Fine Besteel and Dongwoo Farm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fine Besteel and Dongwoo Farm
The main advantage of trading using opposite Fine Besteel and Dongwoo Farm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fine Besteel position performs unexpectedly, Dongwoo Farm 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 Dongwoo Farm will offset losses from the drop in Dongwoo Farm's long position.| Fine Besteel vs. AptaBio Therapeutics | Fine Besteel vs. Daewoo SBI SPAC | Fine Besteel vs. Dream Security co | Fine Besteel vs. Microfriend |
| Dongwoo Farm vs. Maeil Dairies Co | Dongwoo Farm vs. Busan Industrial Co | Dongwoo Farm vs. Busan Ind | Dongwoo Farm vs. Mirae Asset Daewoo |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |