Correlation Between Dgb Financial and Hyundai Engineering
Can any of the company-specific risk be diversified away by investing in both Dgb Financial and Hyundai Engineering 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 Hyundai Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dgb Financial and Hyundai Engineering Plastics, you can compare the effects of market volatilities on Dgb Financial and Hyundai Engineering 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 Hyundai Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dgb Financial and Hyundai Engineering.
Diversification Opportunities for Dgb Financial and Hyundai Engineering
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dgb and Hyundai is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Dgb Financial and Hyundai Engineering Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Engineering 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 Hyundai Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Engineering has no effect on the direction of Dgb Financial i.e., Dgb Financial and Hyundai Engineering go up and down completely randomly.
Pair Corralation between Dgb Financial and Hyundai Engineering
Assuming the 90 days trading horizon Dgb Financial is expected to generate 0.82 times more return on investment than Hyundai Engineering. However, Dgb Financial is 1.22 times less risky than Hyundai Engineering. It trades about 0.14 of its potential returns per unit of risk. Hyundai Engineering Plastics is currently generating about -0.08 per unit of risk. If you would invest 749,000 in Dgb Financial on November 3, 2024 and sell it today you would earn a total of 173,000 from holding Dgb Financial or generate 23.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dgb Financial vs. Hyundai Engineering Plastics
Performance |
| Timeline |
| Dgb Financial |
| Hyundai Engineering |
Dgb Financial and Hyundai Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dgb Financial and Hyundai Engineering
The main advantage of trading using opposite Dgb Financial and Hyundai Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dgb Financial position performs unexpectedly, Hyundai Engineering 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 Hyundai Engineering will offset losses from the drop in Hyundai Engineering's long position.| Dgb Financial vs. KB Financial Group | Dgb Financial vs. Shinhan Financial Group | Dgb Financial vs. Hana Financial | Dgb Financial vs. Woori Financial Group |
| Hyundai Engineering vs. Daewon Media Co | Hyundai Engineering vs. Namhae Chemical | Hyundai Engineering vs. KPX Green Chemical | Hyundai Engineering vs. Kg Chemical |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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