Correlation Between DONGKUK TED and KakaoBank Corp
Can any of the company-specific risk be diversified away by investing in both DONGKUK TED and KakaoBank Corp 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 KakaoBank Corp 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 KakaoBank Corp, you can compare the effects of market volatilities on DONGKUK TED and KakaoBank Corp 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 KakaoBank Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of DONGKUK TED and KakaoBank Corp.
Diversification Opportunities for DONGKUK TED and KakaoBank Corp
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between DONGKUK and KakaoBank is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and KakaoBank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KakaoBank Corp 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 KakaoBank Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KakaoBank Corp has no effect on the direction of DONGKUK TED i.e., DONGKUK TED and KakaoBank Corp go up and down completely randomly.
Pair Corralation between DONGKUK TED and KakaoBank Corp
Assuming the 90 days trading horizon DONGKUK TED METAL is expected to generate 0.72 times more return on investment than KakaoBank Corp. However, DONGKUK TED METAL is 1.39 times less risky than KakaoBank Corp. It trades about 0.09 of its potential returns per unit of risk. KakaoBank Corp is currently generating about 0.05 per unit of risk. If you would invest 610,000 in DONGKUK TED METAL on October 16, 2024 and sell it today you would earn a total of 38,000 from holding DONGKUK TED METAL or generate 6.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DONGKUK TED METAL vs. KakaoBank Corp
Performance |
| Timeline |
| DONGKUK TED METAL |
| KakaoBank Corp |
DONGKUK TED and KakaoBank Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DONGKUK TED and KakaoBank Corp
The main advantage of trading using opposite DONGKUK TED and KakaoBank Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DONGKUK TED position performs unexpectedly, KakaoBank Corp 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 KakaoBank Corp will offset losses from the drop in KakaoBank Corp's long position.| DONGKUK TED vs. V One Tech Co | DONGKUK TED vs. Yura Tech Co | DONGKUK TED vs. Korea Information Communications | DONGKUK TED vs. SS TECH |
| KakaoBank Corp vs. Hanjoo Light Metal | KakaoBank Corp vs. PJ Metal Co | KakaoBank Corp vs. DONGKUK TED METAL | KakaoBank Corp vs. Korea Air Svc |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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