Correlation Between Dufu Tech and K One
Can any of the company-specific risk be diversified away by investing in both Dufu Tech and K One 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 Dufu Tech and K One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dufu Tech Corp and K One Technology Bhd, you can compare the effects of market volatilities on Dufu Tech and K One 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 Dufu Tech with a short position of K One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dufu Tech and K One.
Diversification Opportunities for Dufu Tech and K One
Poor diversification
The 3 months correlation between Dufu and 0111 is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dufu Tech Corp and K One Technology Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K One Technology and Dufu Tech 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 Dufu Tech Corp are associated (or correlated) with K One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K One Technology has no effect on the direction of Dufu Tech i.e., Dufu Tech and K One go up and down completely randomly.
Pair Corralation between Dufu Tech and K One
Assuming the 90 days trading horizon Dufu Tech Corp is expected to generate 0.41 times more return on investment than K One. However, Dufu Tech Corp is 2.45 times less risky than K One. It trades about -0.25 of its potential returns per unit of risk. K One Technology Bhd is currently generating about -0.16 per unit of risk. If you would invest 192.00 in Dufu Tech Corp on October 26, 2024 and sell it today you would lose (17.00) from holding Dufu Tech Corp or give up 8.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dufu Tech Corp vs. K One Technology Bhd
Performance |
| Timeline |
| Dufu Tech Corp |
| K One Technology |
Dufu Tech and K One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dufu Tech and K One
The main advantage of trading using opposite Dufu Tech and K One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dufu Tech position performs unexpectedly, K One 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 K One will offset losses from the drop in K One's long position.| Dufu Tech vs. K One Technology Bhd | Dufu Tech vs. Sapura Industrial Bhd | Dufu Tech vs. Cloudpoint Technology Berhad | Dufu Tech vs. MI Technovation Bhd |
| K One vs. Uchi Technologies Bhd | K One vs. Nexgram Holdings Bhd | K One vs. Digistar Bhd | K One vs. AirAsia X Bhd |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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