Correlation Between Hanwha InvestmentSecuri and Genie Music
Can any of the company-specific risk be diversified away by investing in both Hanwha InvestmentSecuri and Genie Music 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 Genie Music 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 Genie Music, you can compare the effects of market volatilities on Hanwha InvestmentSecuri and Genie Music 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 Genie Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha InvestmentSecuri and Genie Music.
Diversification Opportunities for Hanwha InvestmentSecuri and Genie Music
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hanwha and Genie is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha InvestmentSecurities Co and Genie Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genie Music 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 Genie Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genie Music has no effect on the direction of Hanwha InvestmentSecuri i.e., Hanwha InvestmentSecuri and Genie Music go up and down completely randomly.
Pair Corralation between Hanwha InvestmentSecuri and Genie Music
Assuming the 90 days trading horizon Hanwha InvestmentSecurities Co is expected to under-perform the Genie Music. In addition to that, Hanwha InvestmentSecuri is 1.31 times more volatile than Genie Music. It trades about -0.01 of its total potential returns per unit of risk. Genie Music is currently generating about 0.02 per unit of volatility. If you would invest 217,000 in Genie Music on September 27, 2024 and sell it today you would earn a total of 1,000.00 from holding Genie Music or generate 0.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanwha InvestmentSecurities Co vs. Genie Music
Performance |
| Timeline |
| Hanwha InvestmentSecuri |
| Genie Music |
Hanwha InvestmentSecuri and Genie Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha InvestmentSecuri and Genie Music
The main advantage of trading using opposite Hanwha InvestmentSecuri and Genie Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha InvestmentSecuri position performs unexpectedly, Genie Music 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 Genie Music will offset losses from the drop in Genie Music's long position.The idea behind Hanwha InvestmentSecurities Co and Genie Music pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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