Correlation Between DSC Investment and Samhyun Steel
Can any of the company-specific risk be diversified away by investing in both DSC Investment and Samhyun Steel 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 DSC Investment and Samhyun Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DSC Investment and Samhyun Steel Co, you can compare the effects of market volatilities on DSC Investment and Samhyun Steel 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 DSC Investment with a short position of Samhyun Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of DSC Investment and Samhyun Steel.
Diversification Opportunities for DSC Investment and Samhyun Steel
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DSC and Samhyun is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding DSC Investment and Samhyun Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhyun Steel and DSC Investment 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 DSC Investment are associated (or correlated) with Samhyun Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhyun Steel has no effect on the direction of DSC Investment i.e., DSC Investment and Samhyun Steel go up and down completely randomly.
Pair Corralation between DSC Investment and Samhyun Steel
Assuming the 90 days trading horizon DSC Investment is expected to generate 2.23 times more return on investment than Samhyun Steel. However, DSC Investment is 2.23 times more volatile than Samhyun Steel Co. It trades about -0.01 of its potential returns per unit of risk. Samhyun Steel Co is currently generating about -0.02 per unit of risk. If you would invest 343,000 in DSC Investment on September 12, 2024 and sell it today you would lose (64,000) from holding DSC Investment or give up 18.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DSC Investment vs. Samhyun Steel Co
Performance |
| Timeline |
| DSC Investment |
| Samhyun Steel |
DSC Investment and Samhyun Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DSC Investment and Samhyun Steel
The main advantage of trading using opposite DSC Investment and Samhyun Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DSC Investment position performs unexpectedly, Samhyun Steel 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 Samhyun Steel will offset losses from the drop in Samhyun Steel's long position.| DSC Investment vs. Nh Investment And | DSC Investment vs. Hanwha InvestmentSecurities Co | DSC Investment vs. Solution Advanced Technology | DSC Investment vs. Busan Industrial Co |
| Samhyun Steel vs. Keum Kang Steel | Samhyun Steel vs. PJ Metal Co | Samhyun Steel vs. Gyeongnam Steel Co | Samhyun Steel vs. Jeil Steel Mfg |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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