Correlation Between DONGKUK TED and Raontech
Can any of the company-specific risk be diversified away by investing in both DONGKUK TED and Raontech 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 Raontech 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 Raontech, you can compare the effects of market volatilities on DONGKUK TED and Raontech 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 Raontech. Check out your portfolio center. Please also check ongoing floating volatility patterns of DONGKUK TED and Raontech.
Diversification Opportunities for DONGKUK TED and Raontech
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DONGKUK and Raontech is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and Raontech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Raontech 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 Raontech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Raontech has no effect on the direction of DONGKUK TED i.e., DONGKUK TED and Raontech go up and down completely randomly.
Pair Corralation between DONGKUK TED and Raontech
Assuming the 90 days trading horizon DONGKUK TED is expected to generate 3.32 times less return on investment than Raontech. But when comparing it to its historical volatility, DONGKUK TED METAL is 3.29 times less risky than Raontech. It trades about 0.25 of its potential returns per unit of risk. Raontech is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 314,000 in Raontech on October 16, 2024 and sell it today you would earn a total of 62,000 from holding Raontech or generate 19.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DONGKUK TED METAL vs. Raontech
Performance |
| Timeline |
| DONGKUK TED METAL |
| Raontech |
DONGKUK TED and Raontech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DONGKUK TED and Raontech
The main advantage of trading using opposite DONGKUK TED and Raontech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DONGKUK TED position performs unexpectedly, Raontech 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 Raontech will offset losses from the drop in Raontech'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 |
| Raontech vs. RF Materials Co | Raontech vs. Daeduck Electronics Co | Raontech vs. Cuckoo Electronics Co | Raontech vs. Wave Electronics 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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