Correlation Between Hanjin Transportation and System
Can any of the company-specific risk be diversified away by investing in both Hanjin Transportation and System 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 System 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 System and Application, you can compare the effects of market volatilities on Hanjin Transportation and System 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 System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjin Transportation and System.
Diversification Opportunities for Hanjin Transportation and System
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hanjin and System is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Hanjin Transportation Co and System and Application in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on System and Application 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 System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of System and Application has no effect on the direction of Hanjin Transportation i.e., Hanjin Transportation and System go up and down completely randomly.
Pair Corralation between Hanjin Transportation and System
Assuming the 90 days trading horizon Hanjin Transportation Co is expected to generate 0.21 times more return on investment than System. However, Hanjin Transportation Co is 4.79 times less risky than System. It trades about 0.51 of its potential returns per unit of risk. System and Application is currently generating about 0.07 per unit of risk. If you would invest 1,825,853 in Hanjin Transportation Co on October 12, 2024 and sell it today you would earn a total of 128,147 from holding Hanjin Transportation Co or generate 7.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjin Transportation Co vs. System and Application
Performance |
| Timeline |
| Hanjin Transportation |
| System and Application |
Hanjin Transportation and System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjin Transportation and System
The main advantage of trading using opposite Hanjin Transportation and System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjin Transportation position performs unexpectedly, System 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 System will offset losses from the drop in System's long position.| Hanjin Transportation vs. Samyoung Electronics Co | Hanjin Transportation vs. Youngsin Metal Industrial | Hanjin Transportation vs. Samji Electronics Co | Hanjin Transportation vs. LG Household Healthcare |
| System vs. Ssangyong Information Communication | System vs. Daishin Information Communications | System vs. Lotte Data Communication | System vs. Echomarketing CoLtd |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Stocks Directory Find actively traded stocks across global markets |