Correlation Between DSC Investment and SAMJIN
Can any of the company-specific risk be diversified away by investing in both DSC Investment and SAMJIN 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 SAMJIN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DSC Investment and SAMJIN Co, you can compare the effects of market volatilities on DSC Investment and SAMJIN 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 SAMJIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of DSC Investment and SAMJIN.
Diversification Opportunities for DSC Investment and SAMJIN
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DSC and SAMJIN is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding DSC Investment and SAMJIN Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMJIN 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 SAMJIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMJIN has no effect on the direction of DSC Investment i.e., DSC Investment and SAMJIN go up and down completely randomly.
Pair Corralation between DSC Investment and SAMJIN
Assuming the 90 days trading horizon DSC Investment is expected to under-perform the SAMJIN. In addition to that, DSC Investment is 1.25 times more volatile than SAMJIN Co. It trades about -0.06 of its total potential returns per unit of risk. SAMJIN Co is currently generating about -0.05 per unit of volatility. If you would invest 487,000 in SAMJIN Co on September 3, 2024 and sell it today you would lose (64,500) from holding SAMJIN Co or give up 13.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DSC Investment vs. SAMJIN Co
Performance |
| Timeline |
| DSC Investment |
| SAMJIN |
DSC Investment and SAMJIN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DSC Investment and SAMJIN
The main advantage of trading using opposite DSC Investment and SAMJIN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DSC Investment position performs unexpectedly, SAMJIN 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 SAMJIN will offset losses from the drop in SAMJIN's long position.| DSC Investment vs. Nh Investment And | DSC Investment vs. Hanwha InvestmentSecurities Co | DSC Investment vs. Samsung Special Purpose | DSC Investment vs. YeSUN Tech CoLtd |
| SAMJIN vs. DSC Investment | SAMJIN vs. SV Investment | SAMJIN vs. Woori Technology Investment | SAMJIN vs. SBI Investment KOREA |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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