Correlation Between Taewoong Logistics and Doosan Pref
Can any of the company-specific risk be diversified away by investing in both Taewoong Logistics and Doosan Pref 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 Taewoong Logistics and Doosan Pref into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taewoong Logistics CoLtd and Doosan Pref Shs, you can compare the effects of market volatilities on Taewoong Logistics and Doosan Pref 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 Taewoong Logistics with a short position of Doosan Pref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taewoong Logistics and Doosan Pref.
Diversification Opportunities for Taewoong Logistics and Doosan Pref
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Taewoong and Doosan is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Taewoong Logistics CoLtd and Doosan Pref Shs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doosan Pref Shs and Taewoong Logistics 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 Taewoong Logistics CoLtd are associated (or correlated) with Doosan Pref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doosan Pref Shs has no effect on the direction of Taewoong Logistics i.e., Taewoong Logistics and Doosan Pref go up and down completely randomly.
Pair Corralation between Taewoong Logistics and Doosan Pref
Assuming the 90 days trading horizon Taewoong Logistics CoLtd is expected to under-perform the Doosan Pref. But the stock apears to be less risky and, when comparing its historical volatility, Taewoong Logistics CoLtd is 1.51 times less risky than Doosan Pref. The stock trades about 0.0 of its potential returns per unit of risk. The Doosan Pref Shs is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 8,060,000 in Doosan Pref Shs on October 8, 2024 and sell it today you would earn a total of 4,100,000 from holding Doosan Pref Shs or generate 50.87% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Taewoong Logistics CoLtd vs. Doosan Pref Shs
Performance |
Timeline |
Taewoong Logistics CoLtd |
Doosan Pref Shs |
Taewoong Logistics and Doosan Pref Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Taewoong Logistics and Doosan Pref
The main advantage of trading using opposite Taewoong Logistics and Doosan Pref positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taewoong Logistics position performs unexpectedly, Doosan Pref 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 Doosan Pref will offset losses from the drop in Doosan Pref's long position.Taewoong Logistics vs. WONIK Materials CoLtd | Taewoong Logistics vs. GS Retail Co | Taewoong Logistics vs. PI Advanced Materials | Taewoong Logistics vs. TOPMATERIAL LTD |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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