Correlation Between Shinil Electronics and HANA Micron
Can any of the company-specific risk be diversified away by investing in both Shinil Electronics and HANA Micron 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 Shinil Electronics and HANA Micron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinil Electronics Co and HANA Micron, you can compare the effects of market volatilities on Shinil Electronics and HANA Micron 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 Shinil Electronics with a short position of HANA Micron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinil Electronics and HANA Micron.
Diversification Opportunities for Shinil Electronics and HANA Micron
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shinil and HANA is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Shinil Electronics Co and HANA Micron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANA Micron and Shinil Electronics 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 Shinil Electronics Co are associated (or correlated) with HANA Micron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANA Micron has no effect on the direction of Shinil Electronics i.e., Shinil Electronics and HANA Micron go up and down completely randomly.
Pair Corralation between Shinil Electronics and HANA Micron
Assuming the 90 days trading horizon Shinil Electronics Co is expected to generate 0.32 times more return on investment than HANA Micron. However, Shinil Electronics Co is 3.1 times less risky than HANA Micron. It trades about -0.1 of its potential returns per unit of risk. HANA Micron is currently generating about -0.11 per unit of risk. If you would invest 184,600 in Shinil Electronics Co on September 1, 2024 and sell it today you would lose (39,100) from holding Shinil Electronics Co or give up 21.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.45% |
| Values | Daily Returns |
Shinil Electronics Co vs. HANA Micron
Performance |
| Timeline |
| Shinil Electronics |
| HANA Micron |
Shinil Electronics and HANA Micron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinil Electronics and HANA Micron
The main advantage of trading using opposite Shinil Electronics and HANA Micron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinil Electronics position performs unexpectedly, HANA Micron 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 HANA Micron will offset losses from the drop in HANA Micron's long position.| Shinil Electronics vs. LG Display | Shinil Electronics vs. Hyundai Motor Co | Shinil Electronics vs. Hyundai Motor Co | Shinil Electronics vs. Adaptive Plasma Technology |
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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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