Correlation Between Hanjin Transportation and Dongwon Metal
Can any of the company-specific risk be diversified away by investing in both Hanjin Transportation and Dongwon Metal 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 Dongwon Metal 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 Dongwon Metal Co, you can compare the effects of market volatilities on Hanjin Transportation and Dongwon Metal 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 Dongwon Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjin Transportation and Dongwon Metal.
Diversification Opportunities for Hanjin Transportation and Dongwon Metal
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hanjin and Dongwon is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Hanjin Transportation Co and Dongwon Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongwon Metal 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 Dongwon Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongwon Metal has no effect on the direction of Hanjin Transportation i.e., Hanjin Transportation and Dongwon Metal go up and down completely randomly.
Pair Corralation between Hanjin Transportation and Dongwon Metal
Assuming the 90 days trading horizon Hanjin Transportation Co is expected to generate 0.8 times more return on investment than Dongwon Metal. However, Hanjin Transportation Co is 1.25 times less risky than Dongwon Metal. It trades about -0.07 of its potential returns per unit of risk. Dongwon Metal Co is currently generating about -0.25 per unit of risk. If you would invest 1,960,000 in Hanjin Transportation Co on August 28, 2024 and sell it today you would lose (114,000) from holding Hanjin Transportation Co or give up 5.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjin Transportation Co vs. Dongwon Metal Co
Performance |
| Timeline |
| Hanjin Transportation |
| Dongwon Metal |
Hanjin Transportation and Dongwon Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjin Transportation and Dongwon Metal
The main advantage of trading using opposite Hanjin Transportation and Dongwon Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjin Transportation position performs unexpectedly, Dongwon Metal 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 Dongwon Metal will offset losses from the drop in Dongwon Metal's long position.| Hanjin Transportation vs. AptaBio Therapeutics | Hanjin Transportation vs. Daewoo SBI SPAC | Hanjin Transportation vs. Dream Security co | Hanjin Transportation vs. Microfriend |
| Dongwon Metal vs. AptaBio Therapeutics | Dongwon Metal vs. Daewoo SBI SPAC | Dongwon Metal vs. Dream Security co | Dongwon Metal vs. Microfriend |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |