Correlation Between Daishin Information and Koryo Credit
Can any of the company-specific risk be diversified away by investing in both Daishin Information and Koryo Credit 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 Daishin Information and Koryo Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daishin Information Communications and Koryo Credit Information, you can compare the effects of market volatilities on Daishin Information and Koryo Credit 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 Daishin Information with a short position of Koryo Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daishin Information and Koryo Credit.
Diversification Opportunities for Daishin Information and Koryo Credit
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Daishin and Koryo is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Daishin Information Communicat and Koryo Credit Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Koryo Credit Information and Daishin Information 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 Daishin Information Communications are associated (or correlated) with Koryo Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Koryo Credit Information has no effect on the direction of Daishin Information i.e., Daishin Information and Koryo Credit go up and down completely randomly.
Pair Corralation between Daishin Information and Koryo Credit
Assuming the 90 days trading horizon Daishin Information Communications is expected to generate 7.27 times more return on investment than Koryo Credit. However, Daishin Information is 7.27 times more volatile than Koryo Credit Information. It trades about 0.14 of its potential returns per unit of risk. Koryo Credit Information is currently generating about 0.01 per unit of risk. If you would invest 92,100 in Daishin Information Communications on October 5, 2024 and sell it today you would earn a total of 14,700 from holding Daishin Information Communications or generate 15.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Daishin Information Communicat vs. Koryo Credit Information
Performance |
Timeline |
Daishin Information |
Koryo Credit Information |
Daishin Information and Koryo Credit Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Daishin Information and Koryo Credit
The main advantage of trading using opposite Daishin Information and Koryo Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daishin Information position performs unexpectedly, Koryo Credit 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 Koryo Credit will offset losses from the drop in Koryo Credit's long position.Daishin Information vs. Settlebank | Daishin Information vs. Cafe24 Corp | Daishin Information vs. Korea Computer Systems | Daishin Information vs. SSR Inc |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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