Correlation Between KBSTAR 200TR and Daou Data
Can any of the company-specific risk be diversified away by investing in both KBSTAR 200TR and Daou Data 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 KBSTAR 200TR and Daou Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KBSTAR 200TR and Daou Data Corp, you can compare the effects of market volatilities on KBSTAR 200TR and Daou Data 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 KBSTAR 200TR with a short position of Daou Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of KBSTAR 200TR and Daou Data.
Diversification Opportunities for KBSTAR 200TR and Daou Data
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KBSTAR and Daou is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding KBSTAR 200TR and Daou Data Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daou Data Corp and KBSTAR 200TR 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 KBSTAR 200TR are associated (or correlated) with Daou Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daou Data Corp has no effect on the direction of KBSTAR 200TR i.e., KBSTAR 200TR and Daou Data go up and down completely randomly.
Pair Corralation between KBSTAR 200TR and Daou Data
Assuming the 90 days trading horizon KBSTAR 200TR is expected to under-perform the Daou Data. In addition to that, KBSTAR 200TR is 1.09 times more volatile than Daou Data Corp. It trades about -0.16 of its total potential returns per unit of risk. Daou Data Corp is currently generating about -0.05 per unit of volatility. If you would invest 1,095,000 in Daou Data Corp on September 1, 2024 and sell it today you would lose (14,000) from holding Daou Data Corp or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KBSTAR 200TR vs. Daou Data Corp
Performance |
| Timeline |
| KBSTAR 200TR |
| Daou Data Corp |
KBSTAR 200TR and Daou Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KBSTAR 200TR and Daou Data
The main advantage of trading using opposite KBSTAR 200TR and Daou Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KBSTAR 200TR position performs unexpectedly, Daou Data 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 Daou Data will offset losses from the drop in Daou Data's long position.| KBSTAR 200TR vs. KBSTAR HealthCare Fixed | KBSTAR 200TR vs. KBSTAR EURO STOXX | KBSTAR 200TR vs. KBSTAR Global Metaverse | KBSTAR 200TR vs. KBSTAR Short Term IG |
| Daou Data vs. Dongjin Semichem Co | Daou Data vs. AhnLab Inc | Daou Data vs. Posco ICT | Daou Data vs. CJ ENM |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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