Correlation Between DRB Industrial and Netmarble Games
Can any of the company-specific risk be diversified away by investing in both DRB Industrial and Netmarble Games 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 Netmarble Games 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 Netmarble Games Corp, you can compare the effects of market volatilities on DRB Industrial and Netmarble Games 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 Netmarble Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of DRB Industrial and Netmarble Games.
Diversification Opportunities for DRB Industrial and Netmarble Games
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DRB and Netmarble is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding DRB Industrial Co and Netmarble Games Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Netmarble Games Corp 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 Netmarble Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Netmarble Games Corp has no effect on the direction of DRB Industrial i.e., DRB Industrial and Netmarble Games go up and down completely randomly.
Pair Corralation between DRB Industrial and Netmarble Games
Assuming the 90 days trading horizon DRB Industrial Co is expected to generate 1.09 times more return on investment than Netmarble Games. However, DRB Industrial is 1.09 times more volatile than Netmarble Games Corp. It trades about 0.08 of its potential returns per unit of risk. Netmarble Games Corp is currently generating about -0.19 per unit of risk. If you would invest 709,239 in DRB Industrial Co on October 30, 2024 and sell it today you would earn a total of 50,761 from holding DRB Industrial Co or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DRB Industrial Co vs. Netmarble Games Corp
Performance |
| Timeline |
| DRB Industrial |
| Netmarble Games Corp |
DRB Industrial and Netmarble Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DRB Industrial and Netmarble Games
The main advantage of trading using opposite DRB Industrial and Netmarble Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DRB Industrial position performs unexpectedly, Netmarble Games 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 Netmarble Games will offset losses from the drop in Netmarble Games' long position.| DRB Industrial vs. Hana Materials | DRB Industrial vs. LG Household Healthcare | DRB Industrial vs. Ecoplastic | DRB Industrial vs. Kolon Plastics |
| Netmarble Games vs. DAEDUCK ELECTRONICS CoLtd | Netmarble Games vs. SEOJEON ELECTRIC MACHINERY | Netmarble Games vs. Seohee Construction Co | Netmarble Games vs. PJ Electronics 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.
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