Correlation Between DONGKUK COATED and Samsung Card

Can any of the company-specific risk be diversified away by investing in both DONGKUK COATED and Samsung Card 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 COATED and Samsung Card 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 Samsung Card Co, you can compare the effects of market volatilities on DONGKUK COATED and Samsung Card 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 COATED with a short position of Samsung Card. Check out your portfolio center. Please also check ongoing floating volatility patterns of DONGKUK COATED and Samsung Card.

Diversification Opportunities for DONGKUK COATED and Samsung Card

-0.21

Correlation Coefficient

DONGKUK COATED  Samsung Card

Very good diversification

The 3 months correlation between DONGKUK and Samsung is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding DONGKUK TED METAL and Samsung Card Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Card and DONGKUK COATED 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 Samsung Card. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Card has no effect on the direction of DONGKUK COATED i.e., DONGKUK COATED and Samsung Card go up and down completely randomly.

Pair Corralation between DONGKUK COATED and Samsung Card

Assuming the 90 days trading horizon DONGKUK TED METAL is expected to generate 1.22 times more return on investment than Samsung Card. However, DONGKUK COATED is 1.22 times more volatile than Samsung Card Co. It trades about -0.01 of its potential returns per unit of risk. Samsung Card Co is currently generating about -0.04 per unit of risk. If you would invest  614,000  in DONGKUK TED METAL on September 25, 2024 and sell it today you would lose (6,000) from holding DONGKUK TED METAL or give up 0.98% of portfolio value over 90 days.

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

DONGKUK TED METAL  vs.  Samsung Card Co

DONGKUK TED METAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DONGKUK TED METAL has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, DONGKUK COATED is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Samsung Card

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Card Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Samsung Card is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with DONGKUK COATED and Samsung Card

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

The idea behind DONGKUK TED METAL and Samsung Card 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.