Correlation Between DC Media and Hurum
Can any of the company-specific risk be diversified away by investing in both DC Media and Hurum 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 Hurum 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 Hurum Co, you can compare the effects of market volatilities on DC Media and Hurum 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 Hurum. Check out your portfolio center. Please also check ongoing floating volatility patterns of DC Media and Hurum.
Diversification Opportunities for DC Media and Hurum
Very good diversification
The 3 months correlation between 263720 and Hurum is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding DC Media Co and Hurum Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hurum 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 Hurum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hurum has no effect on the direction of DC Media i.e., DC Media and Hurum go up and down completely randomly.
Pair Corralation between DC Media and Hurum
Assuming the 90 days trading horizon DC Media Co is expected to generate 1.89 times more return on investment than Hurum. However, DC Media is 1.89 times more volatile than Hurum Co. It trades about 0.04 of its potential returns per unit of risk. Hurum Co is currently generating about -0.01 per unit of risk. If you would invest 1,750,000 in DC Media Co on October 24, 2024 and sell it today you would earn a total of 76,000 from holding DC Media Co or generate 4.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DC Media Co vs. Hurum Co
Performance |
| Timeline |
| DC Media |
| Hurum |
DC Media and Hurum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DC Media and Hurum
The main advantage of trading using opposite DC Media and Hurum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DC Media position performs unexpectedly, Hurum 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 Hurum will offset losses from the drop in Hurum's long position.| DC Media vs. DoubleU Games Co | DC Media vs. Kukdong Oil Chemicals | DC Media vs. Samick Musical Instruments | DC Media vs. Sung Bo Chemicals |
| Hurum vs. Tamul Multimedia Co | Hurum vs. Hanwha Life Insurance | Hurum vs. Daewon Media Co | Hurum vs. DC Media 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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