Correlation Between Hanwha InvestmentSecuri and Automobile
Can any of the company-specific risk be diversified away by investing in both Hanwha InvestmentSecuri and Automobile 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 Hanwha InvestmentSecuri and Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanwha InvestmentSecurities Co and Automobile Pc, you can compare the effects of market volatilities on Hanwha InvestmentSecuri and Automobile 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 Hanwha InvestmentSecuri with a short position of Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha InvestmentSecuri and Automobile.
Diversification Opportunities for Hanwha InvestmentSecuri and Automobile
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hanwha and Automobile is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha InvestmentSecurities Co and Automobile Pc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automobile Pc and Hanwha InvestmentSecuri 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 Hanwha InvestmentSecurities Co are associated (or correlated) with Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automobile Pc has no effect on the direction of Hanwha InvestmentSecuri i.e., Hanwha InvestmentSecuri and Automobile go up and down completely randomly.
Pair Corralation between Hanwha InvestmentSecuri and Automobile
Assuming the 90 days trading horizon Hanwha InvestmentSecurities Co is expected to generate 1.61 times more return on investment than Automobile. However, Hanwha InvestmentSecuri is 1.61 times more volatile than Automobile Pc. It trades about 0.05 of its potential returns per unit of risk. Automobile Pc is currently generating about -0.05 per unit of risk. If you would invest 511,000 in Hanwha InvestmentSecurities Co on September 1, 2024 and sell it today you would earn a total of 201,000 from holding Hanwha InvestmentSecurities Co or generate 39.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanwha InvestmentSecurities Co vs. Automobile Pc
Performance |
| Timeline |
| Hanwha InvestmentSecuri |
| Automobile Pc |
Hanwha InvestmentSecuri and Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha InvestmentSecuri and Automobile
The main advantage of trading using opposite Hanwha InvestmentSecuri and Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha InvestmentSecuri position performs unexpectedly, Automobile 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 Automobile will offset losses from the drop in Automobile's long position.| Hanwha InvestmentSecuri vs. Solution Advanced Technology | Hanwha InvestmentSecuri vs. Busan Industrial Co | Hanwha InvestmentSecuri vs. Busan Ind | Hanwha InvestmentSecuri vs. Mirae Asset Daewoo |
| Automobile vs. Miwon Chemical | Automobile vs. Sung Bo Chemicals | Automobile vs. Chin Yang Chemical | Automobile vs. Daehan Synthetic Fiber |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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