Correlation Between Hwasung Industrial and Handok Clean
Can any of the company-specific risk be diversified away by investing in both Hwasung Industrial and Handok Clean 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 Hwasung Industrial and Handok Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hwasung Industrial Co and Handok Clean Tech, you can compare the effects of market volatilities on Hwasung Industrial and Handok Clean 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 Hwasung Industrial with a short position of Handok Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hwasung Industrial and Handok Clean.
Diversification Opportunities for Hwasung Industrial and Handok Clean
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hwasung and Handok is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Hwasung Industrial Co and Handok Clean Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Handok Clean Tech and Hwasung Industrial 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 Hwasung Industrial Co are associated (or correlated) with Handok Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Handok Clean Tech has no effect on the direction of Hwasung Industrial i.e., Hwasung Industrial and Handok Clean go up and down completely randomly.
Pair Corralation between Hwasung Industrial and Handok Clean
Assuming the 90 days trading horizon Hwasung Industrial is expected to generate 2.69 times less return on investment than Handok Clean. In addition to that, Hwasung Industrial is 1.24 times more volatile than Handok Clean Tech. It trades about 0.14 of its total potential returns per unit of risk. Handok Clean Tech is currently generating about 0.46 per unit of volatility. If you would invest 585,755 in Handok Clean Tech on October 15, 2024 and sell it today you would earn a total of 61,245 from holding Handok Clean Tech or generate 10.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Hwasung Industrial Co vs. Handok Clean Tech
Performance |
Timeline |
Hwasung Industrial |
Handok Clean Tech |
Hwasung Industrial and Handok Clean Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hwasung Industrial and Handok Clean
The main advantage of trading using opposite Hwasung Industrial and Handok Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hwasung Industrial position performs unexpectedly, Handok Clean 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 Handok Clean will offset losses from the drop in Handok Clean's long position.Hwasung Industrial vs. Songwon Industrial Co | Hwasung Industrial vs. ABOV Semiconductor Co | Hwasung Industrial vs. Handok Clean Tech | Hwasung Industrial vs. Cheryong Industrial CoLtd |
Handok Clean vs. Hanjoo Light Metal | Handok Clean vs. Kbi Metal Co | Handok Clean vs. Daiyang Metal Co | Handok Clean vs. SungMoon Electronics Co |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Content Syndication Quickly integrate customizable finance content to your own investment portal |