Correlation Between Daishin Balance and SK Hynix
Can any of the company-specific risk be diversified away by investing in both Daishin Balance and SK Hynix 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 Daishin Balance and SK Hynix into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daishin Balance 1 and SK Hynix, you can compare the effects of market volatilities on Daishin Balance and SK Hynix 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 Daishin Balance with a short position of SK Hynix. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Balance and SK Hynix.
Diversification Opportunities for Daishin Balance and SK Hynix
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Daishin and 000660 is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Balance 1 and SK Hynix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Hynix and Daishin Balance 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 Daishin Balance 1 are associated (or correlated) with SK Hynix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Hynix has no effect on the direction of Daishin Balance i.e., Daishin Balance and SK Hynix go up and down completely randomly.
Pair Corralation between Daishin Balance and SK Hynix
Assuming the 90 days trading horizon Daishin Balance 1 is expected to generate 1.1 times more return on investment than SK Hynix. However, Daishin Balance is 1.1 times more volatile than SK Hynix. It trades about 0.07 of its potential returns per unit of risk. SK Hynix is currently generating about -0.18 per unit of risk. If you would invest 517,000 in Daishin Balance 1 on September 2, 2024 and sell it today you would earn a total of 21,000 from holding Daishin Balance 1 or generate 4.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daishin Balance 1 vs. SK Hynix
Performance |
| Timeline |
| Daishin Balance 1 |
| SK Hynix |
Daishin Balance and SK Hynix Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daishin Balance and SK Hynix
The main advantage of trading using opposite Daishin Balance and SK Hynix positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Balance position performs unexpectedly, SK Hynix 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 SK Hynix will offset losses from the drop in SK Hynix's long position.| Daishin Balance vs. Pan Entertainment Co | Daishin Balance vs. Korea Air Svc | Daishin Balance vs. Air Busan Co | Daishin Balance vs. Mgame Corp |
| SK Hynix vs. Nice Information Telecommunication | SK Hynix vs. PJ Metal Co | SK Hynix vs. iNtRON Biotechnology | SK Hynix vs. Dongil Metal 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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