Correlation Between Dgb Financial and Jb Financial
Can any of the company-specific risk be diversified away by investing in both Dgb Financial and Jb 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 Dgb Financial and Jb Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dgb Financial and Jb Financial, you can compare the effects of market volatilities on Dgb Financial and Jb 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 Dgb Financial with a short position of Jb Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dgb Financial and Jb Financial.
Diversification Opportunities for Dgb Financial and Jb Financial
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dgb and 175330 is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Dgb Financial and Jb Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jb Financial 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 Jb Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jb Financial has no effect on the direction of Dgb Financial i.e., Dgb Financial and Jb Financial go up and down completely randomly.
Pair Corralation between Dgb Financial and Jb Financial
Assuming the 90 days trading horizon Dgb Financial is expected to generate 1.18 times less return on investment than Jb Financial. But when comparing it to its historical volatility, Dgb Financial is 2.29 times less risky than Jb Financial. It trades about 0.45 of its potential returns per unit of risk. Jb Financial is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,791,000 in Jb Financial on September 1, 2024 and sell it today you would earn a total of 177,000 from holding Jb Financial or generate 9.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dgb Financial vs. Jb Financial
Performance |
| Timeline |
| Dgb Financial |
| Jb Financial |
Dgb Financial and Jb Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dgb Financial and Jb Financial
The main advantage of trading using opposite Dgb Financial and Jb Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dgb Financial position performs unexpectedly, Jb 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 Jb Financial will offset losses from the drop in Jb Financial's long position.| Dgb Financial vs. Dongbu Insurance Co | Dgb Financial vs. Kyung In Synthetic Corp | Dgb Financial vs. Pureun Mutual Savings | Dgb Financial vs. GS Retail Co |
| Jb Financial vs. Samsung Electronics Co | Jb Financial vs. Samsung Electronics Co | Jb Financial vs. KB Financial Group | Jb Financial vs. Shinhan Financial Group |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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