Correlation Between DAEDUCK ELECTRONICS and GS Retail
Can any of the company-specific risk be diversified away by investing in both DAEDUCK ELECTRONICS and GS Retail 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 DAEDUCK ELECTRONICS and GS Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DAEDUCK ELECTRONICS CoLtd and GS Retail Co, you can compare the effects of market volatilities on DAEDUCK ELECTRONICS and GS Retail 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 DAEDUCK ELECTRONICS with a short position of GS Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAEDUCK ELECTRONICS and GS Retail.
Diversification Opportunities for DAEDUCK ELECTRONICS and GS Retail
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between DAEDUCK and 007070 is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding DAEDUCK ELECTRONICS CoLtd and GS Retail Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GS Retail and DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS CoLtd are associated (or correlated) with GS Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GS Retail has no effect on the direction of DAEDUCK ELECTRONICS i.e., DAEDUCK ELECTRONICS and GS Retail go up and down completely randomly.
Pair Corralation between DAEDUCK ELECTRONICS and GS Retail
Assuming the 90 days trading horizon DAEDUCK ELECTRONICS is expected to generate 3.33 times less return on investment than GS Retail. But when comparing it to its historical volatility, DAEDUCK ELECTRONICS CoLtd is 1.26 times less risky than GS Retail. It trades about 0.09 of its potential returns per unit of risk. GS Retail Co is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 2,080,000 in GS Retail Co on August 30, 2024 and sell it today you would earn a total of 235,000 from holding GS Retail Co or generate 11.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DAEDUCK ELECTRONICS CoLtd vs. GS Retail Co
Performance |
| Timeline |
| DAEDUCK ELECTRONICS CoLtd |
| GS Retail |
DAEDUCK ELECTRONICS and GS Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DAEDUCK ELECTRONICS and GS Retail
The main advantage of trading using opposite DAEDUCK ELECTRONICS and GS Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAEDUCK ELECTRONICS position performs unexpectedly, GS Retail 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 GS Retail will offset losses from the drop in GS Retail's long position.| DAEDUCK ELECTRONICS vs. Busan Industrial Co | DAEDUCK ELECTRONICS vs. Busan Ind | DAEDUCK ELECTRONICS vs. Shinhan WTI Futures | DAEDUCK ELECTRONICS vs. Finebesteel |
| GS Retail vs. AptaBio Therapeutics | GS Retail vs. Daewoo SBI SPAC | GS Retail vs. Dream Security co | GS Retail vs. Microfriend |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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