Correlation Between DONGKUK TED and Daiyang Metal
Can any of the company-specific risk be diversified away by investing in both DONGKUK TED and Daiyang Metal 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 DONGKUK TED and Daiyang Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DONGKUK TED METAL and Daiyang Metal Co, you can compare the effects of market volatilities on DONGKUK TED and Daiyang Metal 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 DONGKUK TED with a short position of Daiyang Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of DONGKUK TED and Daiyang Metal.
Diversification Opportunities for DONGKUK TED and Daiyang Metal
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DONGKUK and Daiyang is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and Daiyang Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daiyang Metal and DONGKUK TED 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 DONGKUK TED METAL are associated (or correlated) with Daiyang Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daiyang Metal has no effect on the direction of DONGKUK TED i.e., DONGKUK TED and Daiyang Metal go up and down completely randomly.
Pair Corralation between DONGKUK TED and Daiyang Metal
Assuming the 90 days trading horizon DONGKUK TED METAL is expected to generate 0.51 times more return on investment than Daiyang Metal. However, DONGKUK TED METAL is 1.95 times less risky than Daiyang Metal. It trades about -0.14 of its potential returns per unit of risk. Daiyang Metal Co is currently generating about -0.2 per unit of risk. If you would invest 645,000 in DONGKUK TED METAL on August 29, 2024 and sell it today you would lose (31,000) from holding DONGKUK TED METAL or give up 4.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DONGKUK TED METAL vs. Daiyang Metal Co
Performance |
| Timeline |
| DONGKUK TED METAL |
| Daiyang Metal |
DONGKUK TED and Daiyang Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DONGKUK TED and Daiyang Metal
The main advantage of trading using opposite DONGKUK TED and Daiyang Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DONGKUK TED position performs unexpectedly, Daiyang Metal 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 Daiyang Metal will offset losses from the drop in Daiyang Metal's long position.| DONGKUK TED vs. Samsung Electronics Co | DONGKUK TED vs. Samsung Electronics Co | DONGKUK TED vs. LG Energy Solution | DONGKUK TED vs. SK Hynix |
| Daiyang Metal vs. AptaBio Therapeutics | Daiyang Metal vs. Daewoo SBI SPAC | Daiyang Metal vs. Dream Security co | Daiyang Metal 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |