Correlation Between DC Media and IQuest
Can any of the company-specific risk be diversified away by investing in both DC Media and IQuest 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 DC Media and IQuest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DC Media Co and IQuest Co, you can compare the effects of market volatilities on DC Media and IQuest 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 DC Media with a short position of IQuest. Check out your portfolio center. Please also check ongoing floating volatility patterns of DC Media and IQuest.
Diversification Opportunities for DC Media and IQuest
Average diversification
The 3 months correlation between 263720 and IQuest is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding DC Media Co and IQuest Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQuest and DC Media 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 DC Media Co are associated (or correlated) with IQuest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQuest has no effect on the direction of DC Media i.e., DC Media and IQuest go up and down completely randomly.
Pair Corralation between DC Media and IQuest
Assuming the 90 days trading horizon DC Media Co is expected to under-perform the IQuest. In addition to that, DC Media is 3.2 times more volatile than IQuest Co. It trades about -0.23 of its total potential returns per unit of risk. IQuest Co is currently generating about 0.31 per unit of volatility. If you would invest 231,000 in IQuest Co on November 3, 2024 and sell it today you would earn a total of 17,000 from holding IQuest Co or generate 7.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DC Media Co vs. IQuest Co
Performance |
| Timeline |
| DC Media |
| IQuest |
DC Media and IQuest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DC Media and IQuest
The main advantage of trading using opposite DC Media and IQuest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DC Media position performs unexpectedly, IQuest 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 IQuest will offset losses from the drop in IQuest's long position.| DC Media vs. Sangsangin Investment Securities | DC Media vs. SBI Investment KOREA | DC Media vs. Stic Investments | DC Media vs. Korea Investment Holdings |
| IQuest vs. Dongbang Transport Logistics | IQuest vs. INNOX Advanced Materials | IQuest vs. PI Advanced Materials | IQuest vs. Hana Materials |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |