Correlation Between Hanjin Transportation and Samil CoLtd
Can any of the company-specific risk be diversified away by investing in both Hanjin Transportation and Samil CoLtd 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 Samil CoLtd 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 Samil CoLtd, you can compare the effects of market volatilities on Hanjin Transportation and Samil CoLtd 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 Samil CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjin Transportation and Samil CoLtd.
Diversification Opportunities for Hanjin Transportation and Samil CoLtd
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hanjin and Samil is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hanjin Transportation Co and Samil CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samil CoLtd 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 Samil CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samil CoLtd has no effect on the direction of Hanjin Transportation i.e., Hanjin Transportation and Samil CoLtd go up and down completely randomly.
Pair Corralation between Hanjin Transportation and Samil CoLtd
Assuming the 90 days trading horizon Hanjin Transportation Co is expected to under-perform the Samil CoLtd. In addition to that, Hanjin Transportation is 1.04 times more volatile than Samil CoLtd. It trades about -0.08 of its total potential returns per unit of risk. Samil CoLtd is currently generating about -0.04 per unit of volatility. If you would invest 183,200 in Samil CoLtd on August 27, 2024 and sell it today you would lose (22,400) from holding Samil CoLtd or give up 12.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjin Transportation Co vs. Samil CoLtd
Performance |
| Timeline |
| Hanjin Transportation |
| Samil CoLtd |
Hanjin Transportation and Samil CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjin Transportation and Samil CoLtd
The main advantage of trading using opposite Hanjin Transportation and Samil CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjin Transportation position performs unexpectedly, Samil CoLtd 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 Samil CoLtd will offset losses from the drop in Samil CoLtd's long position.| Hanjin Transportation vs. AptaBio Therapeutics | Hanjin Transportation vs. Daewoo SBI SPAC | Hanjin Transportation vs. Dream Security co | Hanjin Transportation vs. Microfriend |
| Samil CoLtd vs. Inzi Display CoLtd | Samil CoLtd vs. Hanjin Transportation Co | Samil CoLtd vs. CG Hi Tech | Samil CoLtd vs. SBI Investment KOREA |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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