Correlation Between SV Investment and Dongil Technology
Can any of the company-specific risk be diversified away by investing in both SV Investment and Dongil Technology 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 SV Investment and Dongil Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SV Investment and Dongil Technology, you can compare the effects of market volatilities on SV Investment and Dongil Technology 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 SV Investment with a short position of Dongil Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of SV Investment and Dongil Technology.
Diversification Opportunities for SV Investment and Dongil Technology
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 289080 and Dongil is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding SV Investment and Dongil Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongil Technology and SV 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 SV Investment are associated (or correlated) with Dongil Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongil Technology has no effect on the direction of SV Investment i.e., SV Investment and Dongil Technology go up and down completely randomly.
Pair Corralation between SV Investment and Dongil Technology
Assuming the 90 days trading horizon SV Investment is expected to under-perform the Dongil Technology. In addition to that, SV Investment is 1.88 times more volatile than Dongil Technology. It trades about -0.22 of its total potential returns per unit of risk. Dongil Technology is currently generating about -0.14 per unit of volatility. If you would invest 1,146,000 in Dongil Technology on September 2, 2024 and sell it today you would lose (94,000) from holding Dongil Technology or give up 8.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SV Investment vs. Dongil Technology
Performance |
| Timeline |
| SV Investment |
| Dongil Technology |
SV Investment and Dongil Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SV Investment and Dongil Technology
The main advantage of trading using opposite SV Investment and Dongil Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SV Investment position performs unexpectedly, Dongil Technology 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 Dongil Technology will offset losses from the drop in Dongil Technology's long position.| SV Investment vs. Wave Electronics Co | SV Investment vs. Sungmoon Electronics Co | SV Investment vs. KyungIn Electronics Co | SV Investment vs. Handok Clean Tech |
| Dongil Technology vs. Dongsin Engineering Construction | Dongil Technology vs. Doosan Fuel Cell | Dongil Technology vs. Daishin Balance 1 | Dongil Technology vs. Total Soft Bank |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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