Correlation Between Daebo Magnetic and HyVision System
Can any of the company-specific risk be diversified away by investing in both Daebo Magnetic and HyVision System 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 Daebo Magnetic and HyVision System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daebo Magnetic CoLtd and HyVision System, you can compare the effects of market volatilities on Daebo Magnetic and HyVision System 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 Daebo Magnetic with a short position of HyVision System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daebo Magnetic and HyVision System.
Diversification Opportunities for Daebo Magnetic and HyVision System
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daebo and HyVision is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Daebo Magnetic CoLtd and HyVision System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HyVision System and Daebo Magnetic 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 Daebo Magnetic CoLtd are associated (or correlated) with HyVision System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HyVision System has no effect on the direction of Daebo Magnetic i.e., Daebo Magnetic and HyVision System go up and down completely randomly.
Pair Corralation between Daebo Magnetic and HyVision System
Assuming the 90 days trading horizon Daebo Magnetic CoLtd is expected to under-perform the HyVision System. In addition to that, Daebo Magnetic is 1.13 times more volatile than HyVision System. It trades about -0.13 of its total potential returns per unit of risk. HyVision System is currently generating about -0.08 per unit of volatility. If you would invest 2,550,000 in HyVision System on September 14, 2024 and sell it today you would lose (829,000) from holding HyVision System or give up 32.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daebo Magnetic CoLtd vs. HyVision System
Performance |
| Timeline |
| Daebo Magnetic CoLtd |
| HyVision System |
Daebo Magnetic and HyVision System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daebo Magnetic and HyVision System
The main advantage of trading using opposite Daebo Magnetic and HyVision System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daebo Magnetic position performs unexpectedly, HyVision System 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 HyVision System will offset losses from the drop in HyVision System's long position.| Daebo Magnetic vs. Moonbae Steel | Daebo Magnetic vs. Dongbu Steel Co | Daebo Magnetic vs. Foodnamoo | Daebo Magnetic vs. Dong A Steel Technology |
| HyVision System vs. BGF Retail Co | HyVision System vs. DB Insurance Co | HyVision System vs. Lotte Data Communication | HyVision System vs. Kisan Telecom 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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