Correlation Between Doosan Fuel and DAEA TI
Can any of the company-specific risk be diversified away by investing in both Doosan Fuel and DAEA TI 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 Doosan Fuel and DAEA TI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Doosan Fuel Cell and DAEA TI Co, you can compare the effects of market volatilities on Doosan Fuel and DAEA TI 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 Doosan Fuel with a short position of DAEA TI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doosan Fuel and DAEA TI.
Diversification Opportunities for Doosan Fuel and DAEA TI
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Doosan and DAEA is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Doosan Fuel Cell and DAEA TI Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAEA TI and Doosan Fuel 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 Doosan Fuel Cell are associated (or correlated) with DAEA TI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAEA TI has no effect on the direction of Doosan Fuel i.e., Doosan Fuel and DAEA TI go up and down completely randomly.
Pair Corralation between Doosan Fuel and DAEA TI
Assuming the 90 days trading horizon Doosan Fuel Cell is expected to under-perform the DAEA TI. In addition to that, Doosan Fuel is 1.35 times more volatile than DAEA TI Co. It trades about -0.04 of its total potential returns per unit of risk. DAEA TI Co is currently generating about -0.03 per unit of volatility. If you would invest 314,000 in DAEA TI Co on September 3, 2024 and sell it today you would lose (37,500) from holding DAEA TI Co or give up 11.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doosan Fuel Cell vs. DAEA TI Co
Performance |
| Timeline |
| Doosan Fuel Cell |
| DAEA TI |
Doosan Fuel and DAEA TI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doosan Fuel and DAEA TI
The main advantage of trading using opposite Doosan Fuel and DAEA TI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doosan Fuel position performs unexpectedly, DAEA TI 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 DAEA TI will offset losses from the drop in DAEA TI's long position.| Doosan Fuel vs. Woorim Machinery Co | Doosan Fuel vs. Seohee Construction Co | Doosan Fuel vs. DB Financial Investment | Doosan Fuel vs. Golden Bridge Investment |
| DAEA TI vs. Dongsin Engineering Construction | DAEA TI vs. Doosan Fuel Cell | DAEA TI vs. Daishin Balance 1 | DAEA TI 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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