Correlation Between SeAH Bestee and Hanil Chemical
Can any of the company-specific risk be diversified away by investing in both SeAH Bestee and Hanil Chemical 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 SeAH Bestee and Hanil Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SeAH Bestee and Hanil Chemical Ind, you can compare the effects of market volatilities on SeAH Bestee and Hanil Chemical 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 SeAH Bestee with a short position of Hanil Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SeAH Bestee and Hanil Chemical.
Diversification Opportunities for SeAH Bestee and Hanil Chemical
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SeAH and Hanil is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding SeAH Bestee and Hanil Chemical Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanil Chemical Ind and SeAH Bestee 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 SeAH Bestee are associated (or correlated) with Hanil Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanil Chemical Ind has no effect on the direction of SeAH Bestee i.e., SeAH Bestee and Hanil Chemical go up and down completely randomly.
Pair Corralation between SeAH Bestee and Hanil Chemical
Assuming the 90 days trading horizon SeAH Bestee is expected to generate 1.1 times more return on investment than Hanil Chemical. However, SeAH Bestee is 1.1 times more volatile than Hanil Chemical Ind. It trades about -0.27 of its potential returns per unit of risk. Hanil Chemical Ind is currently generating about -0.39 per unit of risk. If you would invest 2,045,000 in SeAH Bestee on October 24, 2024 and sell it today you would lose (107,000) from holding SeAH Bestee or give up 5.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SeAH Bestee vs. Hanil Chemical Ind
Performance |
| Timeline |
| SeAH Bestee |
| Hanil Chemical Ind |
SeAH Bestee and Hanil Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SeAH Bestee and Hanil Chemical
The main advantage of trading using opposite SeAH Bestee and Hanil Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SeAH Bestee position performs unexpectedly, Hanil Chemical 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 Hanil Chemical will offset losses from the drop in Hanil Chemical's long position.| SeAH Bestee vs. KTB Investment Securities | SeAH Bestee vs. Green Cross Medical | SeAH Bestee vs. Tway Air Co | SeAH Bestee vs. Pureun Mutual Savings |
| Hanil Chemical vs. Adaptive Plasma Technology | Hanil Chemical vs. Shinil Electronics Co | Hanil Chemical vs. Anam Electronics Co | Hanil Chemical vs. LG Chemicals |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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