Correlation Between Kosdaq Composite and Dong Il
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By analyzing existing cross correlation between Kosdaq Composite Index and Dong Il Steel, you can compare the effects of market volatilities on Kosdaq Composite and Dong Il 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 Dong Il. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and Dong Il.
Diversification Opportunities for Kosdaq Composite and Dong Il
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kosdaq and Dong is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and Dong Il Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dong Il Steel 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 Dong Il. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dong Il Steel has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and Dong Il go up and down completely randomly.
Pair Corralation between Kosdaq Composite and Dong Il
Assuming the 90 days trading horizon Kosdaq Composite Index is expected to generate 0.77 times more return on investment than Dong Il. However, Kosdaq Composite Index is 1.3 times less risky than Dong Il. It trades about -0.1 of its potential returns per unit of risk. Dong Il Steel is currently generating about -0.09 per unit of risk. If you would invest 84,799 in Kosdaq Composite Index on August 25, 2024 and sell it today you would lose (17,044) from holding Kosdaq Composite Index or give up 20.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kosdaq Composite Index vs. Dong Il Steel
Performance |
| Timeline |
Kosdaq Composite and Dong Il Volatility Contrast
Predicted Return Density |
| Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
Dong Il Steel
Pair trading matchups for Dong Il
Pair Trading with Kosdaq Composite and Dong Il
The main advantage of trading using opposite Kosdaq Composite and Dong Il positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, Dong Il 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 Dong Il will offset losses from the drop in Dong Il's long position.| Kosdaq Composite vs. Nam Hwa Construction | Kosdaq Composite vs. Dongbang Ship Machinery | Kosdaq Composite vs. SEOJEON ELECTRIC MACHINERY | Kosdaq Composite vs. Heungkuk Metaltech CoLtd |
| Dong Il vs. Digital Multimedia Technology | Dong Il vs. INNOX Advanced Materials | Dong Il vs. JYP Entertainment Corp | Dong Il vs. Ecoplastic |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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