Correlation Between Daishin Balance and Asia Economy
Can any of the company-specific risk be diversified away by investing in both Daishin Balance and Asia Economy 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 Daishin Balance and Asia Economy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daishin Balance No and Asia Economy Daily, you can compare the effects of market volatilities on Daishin Balance and Asia Economy 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 Daishin Balance with a short position of Asia Economy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Balance and Asia Economy.
Diversification Opportunities for Daishin Balance and Asia Economy
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Daishin and Asia is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Balance No and Asia Economy Daily in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Economy Daily and Daishin Balance 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 Daishin Balance No are associated (or correlated) with Asia Economy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Economy Daily has no effect on the direction of Daishin Balance i.e., Daishin Balance and Asia Economy go up and down completely randomly.
Pair Corralation between Daishin Balance and Asia Economy
Assuming the 90 days trading horizon Daishin Balance No is expected to under-perform the Asia Economy. In addition to that, Daishin Balance is 1.53 times more volatile than Asia Economy Daily. It trades about -0.07 of its total potential returns per unit of risk. Asia Economy Daily is currently generating about 0.02 per unit of volatility. If you would invest 140,800 in Asia Economy Daily on September 12, 2024 and sell it today you would earn a total of 8,200 from holding Asia Economy Daily or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daishin Balance No vs. Asia Economy Daily
Performance |
| Timeline |
| Daishin Balance No |
| Asia Economy Daily |
Daishin Balance and Asia Economy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daishin Balance and Asia Economy
The main advantage of trading using opposite Daishin Balance and Asia Economy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Balance position performs unexpectedly, Asia Economy 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 Asia Economy will offset losses from the drop in Asia Economy's long position.| Daishin Balance vs. LG Chem | Daishin Balance vs. Chunbo Co | Daishin Balance vs. DukSan Neolux CoLtd | Daishin Balance vs. Hyosung Chemical Corp |
| Asia Economy vs. BooKook Steel Co | Asia Economy vs. Kaonmedia Co | Asia Economy vs. DB Insurance Co | Asia Economy vs. Kakao Games Corp |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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