Correlation Between PlayD and Dongbang Transport
Can any of the company-specific risk be diversified away by investing in both PlayD and Dongbang Transport 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 PlayD and Dongbang Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PlayD Co and Dongbang Transport Logistics, you can compare the effects of market volatilities on PlayD and Dongbang Transport 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 PlayD with a short position of Dongbang Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of PlayD and Dongbang Transport.
Diversification Opportunities for PlayD and Dongbang Transport
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PlayD and Dongbang is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding PlayD Co and Dongbang Transport Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongbang Transport and PlayD 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 PlayD Co are associated (or correlated) with Dongbang Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongbang Transport has no effect on the direction of PlayD i.e., PlayD and Dongbang Transport go up and down completely randomly.
Pair Corralation between PlayD and Dongbang Transport
Assuming the 90 days trading horizon PlayD Co is expected to under-perform the Dongbang Transport. In addition to that, PlayD is 1.09 times more volatile than Dongbang Transport Logistics. It trades about -0.16 of its total potential returns per unit of risk. Dongbang Transport Logistics is currently generating about 0.17 per unit of volatility. If you would invest 215,500 in Dongbang Transport Logistics on December 6, 2024 and sell it today you would earn a total of 20,000 from holding Dongbang Transport Logistics or generate 9.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PlayD Co vs. Dongbang Transport Logistics
Performance |
| Timeline |
| PlayD |
| Dongbang Transport |
PlayD and Dongbang Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PlayD and Dongbang Transport
The main advantage of trading using opposite PlayD and Dongbang Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PlayD position performs unexpectedly, Dongbang Transport 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 Dongbang Transport will offset losses from the drop in Dongbang Transport's long position.| PlayD vs. INSUN Environmental New | PlayD vs. Display Tech Co | PlayD vs. Korea Air Svc | PlayD vs. Jin Air Co |
| Dongbang Transport vs. Korea Industrial Co | Dongbang Transport vs. Sangsin Energy Display | Dongbang Transport vs. ZUM Internet Corp | Dongbang Transport vs. BIT Computer 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |