Correlation Between Doosan Fuel and Samjin LND
Can any of the company-specific risk be diversified away by investing in both Doosan Fuel and Samjin LND 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 Samjin LND 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 Samjin LND Co, you can compare the effects of market volatilities on Doosan Fuel and Samjin LND 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 Samjin LND. Check out your portfolio center. Please also check ongoing floating volatility patterns of Doosan Fuel and Samjin LND.
Diversification Opportunities for Doosan Fuel and Samjin LND
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Doosan and Samjin is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Doosan Fuel Cell and Samjin LND Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samjin LND 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 Samjin LND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samjin LND has no effect on the direction of Doosan Fuel i.e., Doosan Fuel and Samjin LND go up and down completely randomly.
Pair Corralation between Doosan Fuel and Samjin LND
Assuming the 90 days trading horizon Doosan Fuel Cell is expected to generate 1.1 times more return on investment than Samjin LND. However, Doosan Fuel is 1.1 times more volatile than Samjin LND Co. It trades about -0.03 of its potential returns per unit of risk. Samjin LND Co is currently generating about -0.09 per unit of risk. If you would invest 3,320,000 in Doosan Fuel Cell on September 4, 2024 and sell it today you would lose (1,567,000) from holding Doosan Fuel Cell or give up 47.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Doosan Fuel Cell vs. Samjin LND Co
Performance |
| Timeline |
| Doosan Fuel Cell |
| Samjin LND |
Doosan Fuel and Samjin LND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Doosan Fuel and Samjin LND
The main advantage of trading using opposite Doosan Fuel and Samjin LND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Doosan Fuel position performs unexpectedly, Samjin LND 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 Samjin LND will offset losses from the drop in Samjin LND's long position.| Doosan Fuel vs. Dong A Steel Technology | Doosan Fuel vs. KG Eco Technology | Doosan Fuel vs. Kakao Games Corp | Doosan Fuel vs. DB Financial Investment |
| Samjin LND vs. PNC Technologies co | Samjin LND vs. Daedong Metals Co | Samjin LND vs. Woori Technology | Samjin LND vs. Eagle Veterinary Technology |
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 CEOs Directory module to screen CEOs from public companies around the world.
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