Correlation Between Hanjin Transportation and Hanwha InvestmentSecuri
Can any of the company-specific risk be diversified away by investing in both Hanjin Transportation and Hanwha InvestmentSecuri 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 Hanjin Transportation and Hanwha InvestmentSecuri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanjin Transportation Co and Hanwha InvestmentSecurities Co, you can compare the effects of market volatilities on Hanjin Transportation and Hanwha InvestmentSecuri 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 Hanjin Transportation with a short position of Hanwha InvestmentSecuri. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjin Transportation and Hanwha InvestmentSecuri.
Diversification Opportunities for Hanjin Transportation and Hanwha InvestmentSecuri
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hanjin and Hanwha is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Hanjin Transportation Co and Hanwha InvestmentSecurities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanwha InvestmentSecuri and Hanjin Transportation 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 Hanjin Transportation Co are associated (or correlated) with Hanwha InvestmentSecuri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanwha InvestmentSecuri has no effect on the direction of Hanjin Transportation i.e., Hanjin Transportation and Hanwha InvestmentSecuri go up and down completely randomly.
Pair Corralation between Hanjin Transportation and Hanwha InvestmentSecuri
Assuming the 90 days trading horizon Hanjin Transportation Co is expected to generate 0.36 times more return on investment than Hanwha InvestmentSecuri. However, Hanjin Transportation Co is 2.8 times less risky than Hanwha InvestmentSecuri. It trades about 0.06 of its potential returns per unit of risk. Hanwha InvestmentSecurities Co is currently generating about -0.3 per unit of risk. If you would invest 1,939,000 in Hanjin Transportation Co on December 1, 2024 and sell it today you would earn a total of 13,000 from holding Hanjin Transportation Co or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjin Transportation Co vs. Hanwha InvestmentSecurities Co
Performance |
| Timeline |
| Hanjin Transportation |
| Hanwha InvestmentSecuri |
Hanjin Transportation and Hanwha InvestmentSecuri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjin Transportation and Hanwha InvestmentSecuri
The main advantage of trading using opposite Hanjin Transportation and Hanwha InvestmentSecuri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjin Transportation position performs unexpectedly, Hanwha InvestmentSecuri 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 Hanwha InvestmentSecuri will offset losses from the drop in Hanwha InvestmentSecuri's long position.| Hanjin Transportation vs. Hyundai Green Food | Hanjin Transportation vs. EBEST Investment Securities | Hanjin Transportation vs. Seoul Food Industrial | Hanjin Transportation vs. DB Financial Investment |
| Hanwha InvestmentSecuri vs. Aju IB Investment | Hanwha InvestmentSecuri vs. Daol Investment Securities | Hanwha InvestmentSecuri vs. Atinum Investment Co | Hanwha InvestmentSecuri vs. Kumho Petro Chemical |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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