Correlation Between Daelim Trading and Ray

Can any of the company-specific risk be diversified away by investing in both Daelim Trading and Ray 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 Daelim Trading and Ray into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Daelim Trading Co and Ray Co, you can compare the effects of market volatilities on Daelim Trading and Ray 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 Daelim Trading with a short position of Ray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daelim Trading and Ray.

Diversification Opportunities for Daelim Trading and Ray

-0.72

Correlation Coefficient

Daelim Trading  Ray

Pay attention - limited upside

The 3 months correlation between Daelim and Ray is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Daelim Trading Co and Ray Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ray Co and Daelim Trading 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 Daelim Trading Co are associated (or correlated) with Ray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ray Co has no effect on the direction of Daelim Trading i.e., Daelim Trading and Ray go up and down completely randomly.

Pair Corralation between Daelim Trading and Ray

Assuming the 90 days trading horizon Daelim Trading Co is expected to under-perform the Ray. But the stock apears to be less risky and, when comparing its historical volatility, Daelim Trading Co is 2.02 times less risky than Ray. The stock trades about -0.11 of its potential returns per unit of risk. The Ray Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  612,000  in Ray Co on December 23, 2024 and sell it today you would earn a total of  217,000  from holding Ray Co or generate 35.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Daelim Trading Co  vs.  Ray Co

Daelim Trading

Risk-Adjusted Performance

Very Weak

Over the last 90 days Daelim Trading Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Ray Co

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ray Co are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Ray sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Daelim Trading and Ray

The main advantage of trading using opposite Daelim Trading and Ray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daelim Trading position performs unexpectedly, Ray 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 Ray will offset losses from the drop in Ray's long position.

The idea behind Daelim Trading Co and Ray Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.