Correlation Between DONGKUK TED and Tamul Multimedia
Can any of the company-specific risk be diversified away by investing in both DONGKUK TED and Tamul Multimedia 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 Tamul Multimedia 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 Tamul Multimedia Co, you can compare the effects of market volatilities on DONGKUK TED and Tamul Multimedia 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 Tamul Multimedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of DONGKUK TED and Tamul Multimedia.
Diversification Opportunities for DONGKUK TED and Tamul Multimedia
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DONGKUK and Tamul is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and Tamul Multimedia Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tamul Multimedia 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 Tamul Multimedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tamul Multimedia has no effect on the direction of DONGKUK TED i.e., DONGKUK TED and Tamul Multimedia go up and down completely randomly.
Pair Corralation between DONGKUK TED and Tamul Multimedia
Assuming the 90 days trading horizon DONGKUK TED METAL is expected to under-perform the Tamul Multimedia. But the stock apears to be less risky and, when comparing its historical volatility, DONGKUK TED METAL is 1.41 times less risky than Tamul Multimedia. The stock trades about -0.1 of its potential returns per unit of risk. The Tamul Multimedia Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 606,000 in Tamul Multimedia Co on September 3, 2024 and sell it today you would lose (173,000) from holding Tamul Multimedia Co or give up 28.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 77.49% |
| Values | Daily Returns |
DONGKUK TED METAL vs. Tamul Multimedia Co
Performance |
| Timeline |
| DONGKUK TED METAL |
| Tamul Multimedia |
DONGKUK TED and Tamul Multimedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DONGKUK TED and Tamul Multimedia
The main advantage of trading using opposite DONGKUK TED and Tamul Multimedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DONGKUK TED position performs unexpectedly, Tamul Multimedia 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 Tamul Multimedia will offset losses from the drop in Tamul Multimedia'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 |
| Tamul Multimedia vs. SK Hynix | Tamul Multimedia vs. LX Semicon Co | Tamul Multimedia vs. Tokai Carbon Korea | Tamul Multimedia vs. People Technology |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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