Correlation Between Lotte Data and DC Media
Can any of the company-specific risk be diversified away by investing in both Lotte Data and DC Media 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 Lotte Data and DC Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Data Communication and DC Media Co, you can compare the effects of market volatilities on Lotte Data and DC Media 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 Lotte Data with a short position of DC Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Data and DC Media.
Diversification Opportunities for Lotte Data and DC Media
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lotte and 263720 is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Data Communication and DC Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DC Media and Lotte Data 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 Lotte Data Communication are associated (or correlated) with DC Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DC Media has no effect on the direction of Lotte Data i.e., Lotte Data and DC Media go up and down completely randomly.
Pair Corralation between Lotte Data and DC Media
Assuming the 90 days trading horizon Lotte Data Communication is expected to under-perform the DC Media. But the stock apears to be less risky and, when comparing its historical volatility, Lotte Data Communication is 1.34 times less risky than DC Media. The stock trades about 0.0 of its potential returns per unit of risk. The DC Media Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,650,000 in DC Media Co on September 24, 2024 and sell it today you would lose (625,000) from holding DC Media Co or give up 23.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Data Communication vs. DC Media Co
Performance |
| Timeline |
| Lotte Data Communication |
| DC Media |
Lotte Data and DC Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Data and DC Media
The main advantage of trading using opposite Lotte Data and DC Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Data position performs unexpectedly, DC Media 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 DC Media will offset losses from the drop in DC Media's long position.| Lotte Data vs. Lotte Chilsung Beverage | Lotte Data vs. Sejong Telecom | Lotte Data vs. SK Telecom Co | Lotte Data vs. Korea Information Communications |
| DC Media vs. Iljin Display | DC Media vs. Lotte Data Communication | DC Media vs. DB Financial Investment | DC Media vs. Woori Technology 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |