Correlation Between SEOJEON ELECTRIC and Dreamus
Can any of the company-specific risk be diversified away by investing in both SEOJEON ELECTRIC and Dreamus 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 SEOJEON ELECTRIC and Dreamus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SEOJEON ELECTRIC MACHINERY and Dreamus Company, you can compare the effects of market volatilities on SEOJEON ELECTRIC and Dreamus 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 SEOJEON ELECTRIC with a short position of Dreamus. Check out your portfolio center. Please also check ongoing floating volatility patterns of SEOJEON ELECTRIC and Dreamus.
Diversification Opportunities for SEOJEON ELECTRIC and Dreamus
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SEOJEON and Dreamus is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding SEOJEON ELECTRIC MACHINERY and Dreamus Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dreamus Company and SEOJEON ELECTRIC 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 SEOJEON ELECTRIC MACHINERY are associated (or correlated) with Dreamus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dreamus Company has no effect on the direction of SEOJEON ELECTRIC i.e., SEOJEON ELECTRIC and Dreamus go up and down completely randomly.
Pair Corralation between SEOJEON ELECTRIC and Dreamus
Assuming the 90 days trading horizon SEOJEON ELECTRIC MACHINERY is expected to generate 1.12 times more return on investment than Dreamus. However, SEOJEON ELECTRIC is 1.12 times more volatile than Dreamus Company. It trades about 0.0 of its potential returns per unit of risk. Dreamus Company is currently generating about -0.04 per unit of risk. If you would invest 619,000 in SEOJEON ELECTRIC MACHINERY on September 2, 2024 and sell it today you would lose (172,000) from holding SEOJEON ELECTRIC MACHINERY or give up 27.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SEOJEON ELECTRIC MACHINERY vs. Dreamus Company
Performance |
| Timeline |
| SEOJEON ELECTRIC MAC |
| Dreamus Company |
SEOJEON ELECTRIC and Dreamus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SEOJEON ELECTRIC and Dreamus
The main advantage of trading using opposite SEOJEON ELECTRIC and Dreamus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SEOJEON ELECTRIC position performs unexpectedly, Dreamus 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 Dreamus will offset losses from the drop in Dreamus' long position.| SEOJEON ELECTRIC vs. Korea New Network | SEOJEON ELECTRIC vs. ICD Co | SEOJEON ELECTRIC vs. DYPNF CoLtd | SEOJEON ELECTRIC vs. Busan Industrial Co |
| Dreamus vs. CG Hi Tech | Dreamus vs. Kukil Metal Co | Dreamus vs. DONGKUK TED METAL | Dreamus vs. Shinsegae Information Communication |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |