Correlation Between Kosdaq Composite and Dongwoo Farm
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By analyzing existing cross correlation between Kosdaq Composite Index and Dongwoo Farm To, you can compare the effects of market volatilities on Kosdaq Composite and Dongwoo Farm 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 Dongwoo Farm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kosdaq Composite and Dongwoo Farm.
Diversification Opportunities for Kosdaq Composite and Dongwoo Farm
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kosdaq and Dongwoo is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kosdaq Composite Index and Dongwoo Farm To in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwoo Farm To 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 Dongwoo Farm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwoo Farm To has no effect on the direction of Kosdaq Composite i.e., Kosdaq Composite and Dongwoo Farm go up and down completely randomly.
Pair Corralation between Kosdaq Composite and Dongwoo Farm
Assuming the 90 days trading horizon Kosdaq Composite Index is expected to generate 1.52 times more return on investment than Dongwoo Farm. However, Kosdaq Composite is 1.52 times more volatile than Dongwoo Farm To. It trades about 0.27 of its potential returns per unit of risk. Dongwoo Farm To is currently generating about 0.22 per unit of risk. If you would invest 72,829 in Kosdaq Composite Index on November 27, 2024 and sell it today you would earn a total of 4,526 from holding Kosdaq Composite Index or generate 6.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Kosdaq Composite Index vs. Dongwoo Farm To
Performance |
| Timeline |
Kosdaq Composite and Dongwoo Farm Volatility Contrast
Predicted Return Density |
| Returns |
Kosdaq Composite Index
Pair trading matchups for Kosdaq Composite
Dongwoo Farm To
Pair trading matchups for Dongwoo Farm
Pair Trading with Kosdaq Composite and Dongwoo Farm
The main advantage of trading using opposite Kosdaq Composite and Dongwoo Farm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kosdaq Composite position performs unexpectedly, Dongwoo Farm 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 Dongwoo Farm will offset losses from the drop in Dongwoo Farm's long position.| Kosdaq Composite vs. Seoul Food Industrial | Kosdaq Composite vs. Organic Special Pet | Kosdaq Composite vs. Hyundai Green Food | Kosdaq Composite vs. Namyang Dairy |
| Dongwoo Farm vs. Maeil Dairies Co | Dongwoo Farm vs. HYUNDAI FEED | Dongwoo Farm vs. Neo Cremar Co | Dongwoo Farm vs. Wing Yip Food |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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