Correlation Between Iljin Display and Daehan Steel

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

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

Diversification Opportunities for Iljin Display and Daehan Steel

0.29

Correlation Coefficient

Iljin Display  Daehan Steel

Modest diversification

The 3 months correlation between Iljin and Daehan is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Iljin Display and Daehan Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daehan Steel and Iljin Display 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 Iljin Display are associated (or correlated) with Daehan Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daehan Steel has no effect on the direction of Iljin Display i.e., Iljin Display and Daehan Steel go up and down completely randomly.

Pair Corralation between Iljin Display and Daehan Steel

Assuming the 90 days trading horizon Iljin Display is expected to generate 2.03 times more return on investment than Daehan Steel. However, Iljin Display is 2.03 times more volatile than Daehan Steel. It trades about 0.07 of its potential returns per unit of risk. Daehan Steel is currently generating about 0.05 per unit of risk. If you would invest  77,000  in Iljin Display on April 25, 2025 and sell it today you would earn a total of  11,400  from holding Iljin Display or generate 14.81% return on investment over 90 days.

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

Iljin Display  vs.  Daehan Steel

Iljin Display

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Iljin Display are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Iljin Display sustained solid returns over the last few months and may actually be approaching a breakup point.

Daehan Steel

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Daehan Steel are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Daehan Steel may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Iljin Display and Daehan Steel

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

The idea behind Iljin Display and Daehan Steel 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.