Correlation Between Daewoo SBI and KyungIn Electronics
Can any of the company-specific risk be diversified away by investing in both Daewoo SBI and KyungIn Electronics 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 Daewoo SBI and KyungIn Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daewoo SBI SPAC and KyungIn Electronics Co, you can compare the effects of market volatilities on Daewoo SBI and KyungIn Electronics 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 Daewoo SBI with a short position of KyungIn Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewoo SBI and KyungIn Electronics.
Diversification Opportunities for Daewoo SBI and KyungIn Electronics
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Daewoo and KyungIn is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Daewoo SBI SPAC and KyungIn Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KyungIn Electronics and Daewoo SBI 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 Daewoo SBI SPAC are associated (or correlated) with KyungIn Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KyungIn Electronics has no effect on the direction of Daewoo SBI i.e., Daewoo SBI and KyungIn Electronics go up and down completely randomly.
Pair Corralation between Daewoo SBI and KyungIn Electronics
Assuming the 90 days trading horizon Daewoo SBI SPAC is expected to under-perform the KyungIn Electronics. In addition to that, Daewoo SBI is 1.53 times more volatile than KyungIn Electronics Co. It trades about -0.22 of its total potential returns per unit of risk. KyungIn Electronics Co is currently generating about 0.13 per unit of volatility. If you would invest 2,085,000 in KyungIn Electronics Co on August 28, 2024 and sell it today you would earn a total of 65,000 from holding KyungIn Electronics Co or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Daewoo SBI SPAC vs. KyungIn Electronics Co
Performance |
| Timeline |
| Daewoo SBI SPAC |
| KyungIn Electronics |
Daewoo SBI and KyungIn Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewoo SBI and KyungIn Electronics
The main advantage of trading using opposite Daewoo SBI and KyungIn Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewoo SBI position performs unexpectedly, KyungIn Electronics 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 KyungIn Electronics will offset losses from the drop in KyungIn Electronics' long position.| Daewoo SBI vs. Deutsch Motors | Daewoo SBI vs. Hanjinkal | Daewoo SBI vs. Busan Industrial Co | Daewoo SBI vs. Busan Ind |
| KyungIn Electronics vs. FOODWELL Co | KyungIn Electronics vs. Organic Special Pet | KyungIn Electronics vs. CJ Seafood Corp | KyungIn Electronics vs. CJ Seafood Corp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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