Correlation Between Dgb Financial and Insung Information
Can any of the company-specific risk be diversified away by investing in both Dgb Financial and Insung Information 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 Dgb Financial and Insung Information into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dgb Financial and Insung Information Co, you can compare the effects of market volatilities on Dgb Financial and Insung Information 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 Dgb Financial with a short position of Insung Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dgb Financial and Insung Information.
Diversification Opportunities for Dgb Financial and Insung Information
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dgb and Insung is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Dgb Financial and Insung Information Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insung Information and Dgb Financial 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 Dgb Financial are associated (or correlated) with Insung Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insung Information has no effect on the direction of Dgb Financial i.e., Dgb Financial and Insung Information go up and down completely randomly.
Pair Corralation between Dgb Financial and Insung Information
Assuming the 90 days trading horizon Dgb Financial is expected to generate 2.49 times less return on investment than Insung Information. But when comparing it to its historical volatility, Dgb Financial is 3.51 times less risky than Insung Information. It trades about 0.03 of its potential returns per unit of risk. Insung Information Co is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 225,354 in Insung Information Co on October 13, 2024 and sell it today you would lose (26,554) from holding Insung Information Co or give up 11.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dgb Financial vs. Insung Information Co
Performance |
| Timeline |
| Dgb Financial |
| Insung Information |
Dgb Financial and Insung Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dgb Financial and Insung Information
The main advantage of trading using opposite Dgb Financial and Insung Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dgb Financial position performs unexpectedly, Insung Information 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 Insung Information will offset losses from the drop in Insung Information's long position.| Dgb Financial vs. Industrial Bank | Dgb Financial vs. Ssangyong Information Communication | Dgb Financial vs. Dongbang Transport Logistics | Dgb Financial vs. Alton Sports CoLtd |
| Insung Information vs. Dgb Financial | Insung Information vs. Hana Financial | Insung Information vs. Ssangyong Information Communication | Insung Information vs. Korean Reinsurance 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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