Correlation Between Daewoo SBI and Duksan Hi
Can any of the company-specific risk be diversified away by investing in both Daewoo SBI and Duksan Hi 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 Duksan Hi 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 Duksan Hi Metal, you can compare the effects of market volatilities on Daewoo SBI and Duksan Hi 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 Duksan Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewoo SBI and Duksan Hi.
Diversification Opportunities for Daewoo SBI and Duksan Hi
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Daewoo and Duksan is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Daewoo SBI SPAC and Duksan Hi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Duksan Hi Metal 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 Duksan Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Duksan Hi Metal has no effect on the direction of Daewoo SBI i.e., Daewoo SBI and Duksan Hi go up and down completely randomly.
Pair Corralation between Daewoo SBI and Duksan Hi
Assuming the 90 days trading horizon Daewoo SBI SPAC is expected to generate 0.6 times more return on investment than Duksan Hi. However, Daewoo SBI SPAC is 1.65 times less risky than Duksan Hi. It trades about -0.08 of its potential returns per unit of risk. Duksan Hi Metal is currently generating about -0.06 per unit of risk. If you would invest 445,000 in Daewoo SBI SPAC on August 28, 2024 and sell it today you would lose (204,000) from holding Daewoo SBI SPAC or give up 45.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewoo SBI SPAC vs. Duksan Hi Metal
Performance |
| Timeline |
| Daewoo SBI SPAC |
| Duksan Hi Metal |
Daewoo SBI and Duksan Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewoo SBI and Duksan Hi
The main advantage of trading using opposite Daewoo SBI and Duksan Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewoo SBI position performs unexpectedly, Duksan Hi 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 Duksan Hi will offset losses from the drop in Duksan Hi's long position.| Daewoo SBI vs. Deutsch Motors | Daewoo SBI vs. Hanjinkal | Daewoo SBI vs. Busan Industrial Co | Daewoo SBI vs. Busan Ind |
| Duksan Hi vs. Korea Real Estate | Duksan Hi vs. Korea Ratings Co | Duksan Hi vs. IQuest Co | Duksan Hi vs. Wonbang Tech 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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