Correlation Between Narae Nanotech and DB Financial
Can any of the company-specific risk be diversified away by investing in both Narae Nanotech and DB Financial 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 Narae Nanotech and DB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Narae Nanotech Corp and DB Financial Investment, you can compare the effects of market volatilities on Narae Nanotech and DB Financial 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 Narae Nanotech with a short position of DB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Narae Nanotech and DB Financial.
Diversification Opportunities for Narae Nanotech and DB Financial
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Narae and 016610 is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Narae Nanotech Corp and DB Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Financial Investment and Narae Nanotech 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 Narae Nanotech Corp are associated (or correlated) with DB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Financial Investment has no effect on the direction of Narae Nanotech i.e., Narae Nanotech and DB Financial go up and down completely randomly.
Pair Corralation between Narae Nanotech and DB Financial
Assuming the 90 days trading horizon Narae Nanotech Corp is expected to under-perform the DB Financial. In addition to that, Narae Nanotech is 4.5 times more volatile than DB Financial Investment. It trades about -0.5 of its total potential returns per unit of risk. DB Financial Investment is currently generating about 0.56 per unit of volatility. If you would invest 519,000 in DB Financial Investment on November 3, 2024 and sell it today you would earn a total of 27,000 from holding DB Financial Investment or generate 5.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Narae Nanotech Corp vs. DB Financial Investment
Performance |
| Timeline |
| Narae Nanotech Corp |
| DB Financial Investment |
Narae Nanotech and DB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Narae Nanotech and DB Financial
The main advantage of trading using opposite Narae Nanotech and DB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Narae Nanotech position performs unexpectedly, DB Financial 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 DB Financial will offset losses from the drop in DB Financial's long position.| Narae Nanotech vs. PNC Technologies co | Narae Nanotech vs. Handok Clean Tech | Narae Nanotech vs. V One Tech Co | Narae Nanotech vs. CG Hi Tech |
| DB Financial vs. Daiyang Metal Co | DB Financial vs. Nam Hwa Construction | DB Financial vs. ENERGYMACHINERY KOREA CoLtd | DB Financial vs. Shinhan Inverse Silver |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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