Correlation Between DONGKUK TED and MetaLabs

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

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

Diversification Opportunities for DONGKUK TED and MetaLabs

0.67

Correlation Coefficient

DONGKUK TED  MetaLabs

Poor diversification

The 3 months correlation between DONGKUK and MetaLabs is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and MetaLabs Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetaLabs and DONGKUK TED 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 DONGKUK TED METAL are associated (or correlated) with MetaLabs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetaLabs has no effect on the direction of DONGKUK TED i.e., DONGKUK TED and MetaLabs go up and down completely randomly.

Pair Corralation between DONGKUK TED and MetaLabs

Assuming the 90 days trading horizon DONGKUK TED METAL is expected to generate 0.75 times more return on investment than MetaLabs. However, DONGKUK TED METAL is 1.33 times less risky than MetaLabs. It trades about 0.2 of its potential returns per unit of risk. MetaLabs Co is currently generating about 0.1 per unit of risk. If you would invest  608,000  in DONGKUK TED METAL on December 26, 2024 and sell it today you would earn a total of  100,000  from holding DONGKUK TED METAL or generate 16.45% return on investment over 90 days.

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

DONGKUK TED METAL  vs.  MetaLabs Co

DONGKUK TED METAL

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in DONGKUK TED METAL are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, DONGKUK TED sustained solid returns over the last few months and may actually be approaching a breakup point.

MetaLabs

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MetaLabs Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, MetaLabs may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with DONGKUK TED and MetaLabs

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

The idea behind DONGKUK TED METAL and MetaLabs 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.