Correlation Between DAEDUCK ELECTRONICS and Daewoo SBI
Can any of the company-specific risk be diversified away by investing in both DAEDUCK ELECTRONICS and Daewoo SBI 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 Daewoo SBI 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 Daewoo SBI SPAC, you can compare the effects of market volatilities on DAEDUCK ELECTRONICS and Daewoo SBI 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 Daewoo SBI. Check out your portfolio center. Please also check ongoing floating volatility patterns of DAEDUCK ELECTRONICS and Daewoo SBI.
Diversification Opportunities for DAEDUCK ELECTRONICS and Daewoo SBI
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between DAEDUCK and Daewoo is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding DAEDUCK ELECTRONICS CoLtd and Daewoo SBI SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewoo SBI SPAC 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 Daewoo SBI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewoo SBI SPAC has no effect on the direction of DAEDUCK ELECTRONICS i.e., DAEDUCK ELECTRONICS and Daewoo SBI go up and down completely randomly.
Pair Corralation between DAEDUCK ELECTRONICS and Daewoo SBI
Assuming the 90 days trading horizon DAEDUCK ELECTRONICS CoLtd is expected to generate 0.78 times more return on investment than Daewoo SBI. However, DAEDUCK ELECTRONICS CoLtd is 1.28 times less risky than Daewoo SBI. It trades about -0.02 of its potential returns per unit of risk. Daewoo SBI SPAC is currently generating about -0.03 per unit of risk. If you would invest 950,281 in DAEDUCK ELECTRONICS CoLtd on September 23, 2024 and sell it today you would lose (156,281) from holding DAEDUCK ELECTRONICS CoLtd or give up 16.45% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
DAEDUCK ELECTRONICS CoLtd vs. Daewoo SBI SPAC
Performance |
Timeline |
DAEDUCK ELECTRONICS CoLtd |
Daewoo SBI SPAC |
DAEDUCK ELECTRONICS and Daewoo SBI Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with DAEDUCK ELECTRONICS and Daewoo SBI
The main advantage of trading using opposite DAEDUCK ELECTRONICS and Daewoo SBI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DAEDUCK ELECTRONICS position performs unexpectedly, Daewoo SBI 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 Daewoo SBI will offset losses from the drop in Daewoo SBI's long position.DAEDUCK ELECTRONICS vs. SK IE Technology | DAEDUCK ELECTRONICS vs. Solus Advanced Materials | DAEDUCK ELECTRONICS vs. Sungmoon Electronics Co |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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