Correlation Between DRB Industrial and GS Retail
Can any of the company-specific risk be diversified away by investing in both DRB Industrial and GS Retail 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 DRB Industrial and GS Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DRB Industrial Co and GS Retail Co, you can compare the effects of market volatilities on DRB Industrial and GS Retail 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 DRB Industrial with a short position of GS Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of DRB Industrial and GS Retail.
Diversification Opportunities for DRB Industrial and GS Retail
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DRB and 007070 is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding DRB Industrial Co and GS Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GS Retail and DRB Industrial 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 DRB Industrial Co are associated (or correlated) with GS Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GS Retail has no effect on the direction of DRB Industrial i.e., DRB Industrial and GS Retail go up and down completely randomly.
Pair Corralation between DRB Industrial and GS Retail
Assuming the 90 days trading horizon DRB Industrial Co is expected to generate 0.65 times more return on investment than GS Retail. However, DRB Industrial Co is 1.54 times less risky than GS Retail. It trades about 0.07 of its potential returns per unit of risk. GS Retail Co is currently generating about -0.35 per unit of risk. If you would invest 714,130 in DRB Industrial Co on October 14, 2024 and sell it today you would earn a total of 13,870 from holding DRB Industrial Co or generate 1.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 68.42% |
| Values | Daily Returns |
DRB Industrial Co vs. GS Retail Co
Performance |
| Timeline |
| DRB Industrial |
| GS Retail |
DRB Industrial and GS Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DRB Industrial and GS Retail
The main advantage of trading using opposite DRB Industrial and GS Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DRB Industrial position performs unexpectedly, GS Retail 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 GS Retail will offset losses from the drop in GS Retail's long position.| DRB Industrial vs. AptaBio Therapeutics | DRB Industrial vs. Daewoo SBI SPAC | DRB Industrial vs. Dream Security co | DRB Industrial vs. Microfriend |
| GS Retail vs. DRB Industrial Co | GS Retail vs. Daejung Chemicals Metals | GS Retail vs. Woori Technology Investment | GS Retail vs. Daesung Industrial 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |