Correlation Between DreamCIS and Korea Air
Can any of the company-specific risk be diversified away by investing in both DreamCIS and Korea Air 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 DreamCIS and Korea Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DreamCIS and Korea Air Svc, you can compare the effects of market volatilities on DreamCIS and Korea Air 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 DreamCIS with a short position of Korea Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of DreamCIS and Korea Air.
Diversification Opportunities for DreamCIS and Korea Air
Average diversification
The 3 months correlation between DreamCIS and Korea is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding DreamCIS and Korea Air Svc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Air Svc and DreamCIS 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 DreamCIS are associated (or correlated) with Korea Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Air Svc has no effect on the direction of DreamCIS i.e., DreamCIS and Korea Air go up and down completely randomly.
Pair Corralation between DreamCIS and Korea Air
Assuming the 90 days trading horizon DreamCIS is expected to under-perform the Korea Air. In addition to that, DreamCIS is 1.24 times more volatile than Korea Air Svc. It trades about -0.31 of its total potential returns per unit of risk. Korea Air Svc is currently generating about 0.13 per unit of volatility. If you would invest 5,670,000 in Korea Air Svc on September 5, 2024 and sell it today you would earn a total of 400,000 from holding Korea Air Svc or generate 7.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DreamCIS vs. Korea Air Svc
Performance |
| Timeline |
| DreamCIS |
| Korea Air Svc |
DreamCIS and Korea Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DreamCIS and Korea Air
The main advantage of trading using opposite DreamCIS and Korea Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DreamCIS position performs unexpectedly, Korea Air 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 Korea Air will offset losses from the drop in Korea Air's long position.| DreamCIS vs. LabGenomics Co | DreamCIS vs. ASTORY CoLtd | DreamCIS vs. Daou Data Corp | DreamCIS vs. AnterogenCoLtd |
| Korea Air vs. LG Display | Korea Air vs. Hyundai Motor | Korea Air vs. Hyundai Motor Co | Korea Air vs. Hyundai Motor 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |