Correlation Between DataSolution and Korean Reinsurance
Can any of the company-specific risk be diversified away by investing in both DataSolution and Korean Reinsurance 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 DataSolution and Korean Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DataSolution and Korean Reinsurance Co, you can compare the effects of market volatilities on DataSolution and Korean Reinsurance 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 DataSolution with a short position of Korean Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of DataSolution and Korean Reinsurance.
Diversification Opportunities for DataSolution and Korean Reinsurance
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DataSolution and Korean is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding DataSolution and Korean Reinsurance Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korean Reinsurance and DataSolution 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 DataSolution are associated (or correlated) with Korean Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korean Reinsurance has no effect on the direction of DataSolution i.e., DataSolution and Korean Reinsurance go up and down completely randomly.
Pair Corralation between DataSolution and Korean Reinsurance
Assuming the 90 days trading horizon DataSolution is expected to generate 4.34 times less return on investment than Korean Reinsurance. In addition to that, DataSolution is 2.37 times more volatile than Korean Reinsurance Co. It trades about 0.01 of its total potential returns per unit of risk. Korean Reinsurance Co is currently generating about 0.08 per unit of volatility. If you would invest 451,613 in Korean Reinsurance Co on September 13, 2024 and sell it today you would earn a total of 354,387 from holding Korean Reinsurance Co or generate 78.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DataSolution vs. Korean Reinsurance Co
Performance |
| Timeline |
| DataSolution |
| Korean Reinsurance |
DataSolution and Korean Reinsurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DataSolution and Korean Reinsurance
The main advantage of trading using opposite DataSolution and Korean Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DataSolution position performs unexpectedly, Korean Reinsurance 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 Korean Reinsurance will offset losses from the drop in Korean Reinsurance's long position.| DataSolution vs. Samsung Electronics Co | DataSolution vs. Samsung Electronics Co | DataSolution vs. LG Energy Solution | DataSolution vs. SK Hynix |
| Korean Reinsurance vs. Dgb Financial | Korean Reinsurance vs. Jeju Bank | Korean Reinsurance vs. Shinhan Financial Group | Korean Reinsurance vs. DB Financial Investment |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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