Correlation Between WooDeumGee Farm and Dongkuk Structures
Can any of the company-specific risk be diversified away by investing in both WooDeumGee Farm and Dongkuk Structures 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 WooDeumGee Farm and Dongkuk Structures into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WooDeumGee Farm Co, and Dongkuk Structures Construction, you can compare the effects of market volatilities on WooDeumGee Farm and Dongkuk Structures 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 WooDeumGee Farm with a short position of Dongkuk Structures. Check out your portfolio center. Please also check ongoing floating volatility patterns of WooDeumGee Farm and Dongkuk Structures.
Diversification Opportunities for WooDeumGee Farm and Dongkuk Structures
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WooDeumGee and Dongkuk is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding WooDeumGee Farm Co, and Dongkuk Structures Constructio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongkuk Structures and WooDeumGee Farm 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 WooDeumGee Farm Co, are associated (or correlated) with Dongkuk Structures. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongkuk Structures has no effect on the direction of WooDeumGee Farm i.e., WooDeumGee Farm and Dongkuk Structures go up and down completely randomly.
Pair Corralation between WooDeumGee Farm and Dongkuk Structures
Assuming the 90 days trading horizon WooDeumGee Farm Co, is expected to generate 1.23 times more return on investment than Dongkuk Structures. However, WooDeumGee Farm is 1.23 times more volatile than Dongkuk Structures Construction. It trades about -0.02 of its potential returns per unit of risk. Dongkuk Structures Construction is currently generating about -0.03 per unit of risk. If you would invest 236,500 in WooDeumGee Farm Co, on September 1, 2024 and sell it today you would lose (61,500) from holding WooDeumGee Farm Co, or give up 26.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.62% |
| Values | Daily Returns |
WooDeumGee Farm Co, vs. Dongkuk Structures Constructio
Performance |
| Timeline |
| WooDeumGee Farm Co, |
| Dongkuk Structures |
WooDeumGee Farm and Dongkuk Structures Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WooDeumGee Farm and Dongkuk Structures
The main advantage of trading using opposite WooDeumGee Farm and Dongkuk Structures positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WooDeumGee Farm position performs unexpectedly, Dongkuk Structures 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 Dongkuk Structures will offset losses from the drop in Dongkuk Structures' long position.| WooDeumGee Farm vs. Samsung Electronics Co | WooDeumGee Farm vs. Samsung Electronics Co | WooDeumGee Farm vs. LG Energy Solution | WooDeumGee Farm vs. SK Hynix |
| Dongkuk Structures vs. Korea New Network | Dongkuk Structures vs. ICD Co | Dongkuk Structures vs. DYPNF CoLtd | Dongkuk Structures vs. Busan Industrial Co |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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