Correlation Between Kosdaq Composite and Dongkuk Steel
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By analyzing existing cross correlation between Kosdaq Composite Index and Dongkuk Steel Mill, you can compare the effects of market volatilities on Kosdaq Composite and Dongkuk Steel 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 Kosdaq Composite with a short position of Dongkuk Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and Dongkuk Steel.
Diversification Opportunities for Kosdaq Composite and Dongkuk Steel
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kosdaq and Dongkuk is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and Dongkuk Steel Mill in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongkuk Steel Mill and Kosdaq Composite 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 Kosdaq Composite Index are associated (or correlated) with Dongkuk Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongkuk Steel Mill has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and Dongkuk Steel go up and down completely randomly.
Pair Corralation between Kosdaq Composite and Dongkuk Steel
Assuming the 90 days trading horizon Kosdaq Composite Index is expected to under-perform the Dongkuk Steel. In addition to that, Kosdaq Composite is 1.51 times more volatile than Dongkuk Steel Mill. It trades about -0.08 of its total potential returns per unit of risk. Dongkuk Steel Mill is currently generating about -0.05 per unit of volatility. If you would invest 804,480 in Dongkuk Steel Mill on August 29, 2024 and sell it today you would lose (55,480) from holding Dongkuk Steel Mill or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.17% |
| Values | Daily Returns |
Kosdaq Composite Index vs. Dongkuk Steel Mill
Performance |
| Timeline |
Kosdaq Composite and Dongkuk Steel Volatility Contrast
Predicted Return Density |
| Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
Dongkuk Steel Mill
Pair trading matchups for Dongkuk Steel
Pair Trading with Kosdaq Composite and Dongkuk Steel
The main advantage of trading using opposite Kosdaq Composite and Dongkuk Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, Dongkuk Steel 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 Dongkuk Steel will offset losses from the drop in Dongkuk Steel's long position.| Kosdaq Composite vs. Shinil Electronics Co | Kosdaq Composite vs. Sungdo Engineering Construction | Kosdaq Composite vs. Seoul Electronics Telecom | Kosdaq Composite vs. ENERGYMACHINERY KOREA CoLtd |
| Dongkuk Steel vs. iNtRON Biotechnology | Dongkuk Steel vs. Korean Drug Co | Dongkuk Steel vs. Vitzro Tech Co | Dongkuk Steel vs. CU Tech Corp |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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