Correlation Between Hanwha InvestmentSecuri and ATON
Can any of the company-specific risk be diversified away by investing in both Hanwha InvestmentSecuri and ATON 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 ATON 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 ATON Inc, you can compare the effects of market volatilities on Hanwha InvestmentSecuri and ATON 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 ATON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha InvestmentSecuri and ATON.
Diversification Opportunities for Hanwha InvestmentSecuri and ATON
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hanwha and ATON is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha InvestmentSecurities Co and ATON Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATON Inc 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 ATON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATON Inc has no effect on the direction of Hanwha InvestmentSecuri i.e., Hanwha InvestmentSecuri and ATON go up and down completely randomly.
Pair Corralation between Hanwha InvestmentSecuri and ATON
Assuming the 90 days trading horizon Hanwha InvestmentSecuri is expected to generate 1.6 times less return on investment than ATON. But when comparing it to its historical volatility, Hanwha InvestmentSecurities Co is 1.05 times less risky than ATON. It trades about 0.1 of its potential returns per unit of risk. ATON Inc is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 314,500 in ATON Inc on September 5, 2024 and sell it today you would earn a total of 204,500 from holding ATON Inc or generate 65.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanwha InvestmentSecurities Co vs. ATON Inc
Performance |
| Timeline |
| Hanwha InvestmentSecuri |
| ATON Inc |
Hanwha InvestmentSecuri and ATON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha InvestmentSecuri and ATON
The main advantage of trading using opposite Hanwha InvestmentSecuri and ATON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha InvestmentSecuri position performs unexpectedly, ATON 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 ATON will offset losses from the drop in ATON's long position.| Hanwha InvestmentSecuri vs. Korean Drug Co | Hanwha InvestmentSecuri vs. Sangsin Energy Display | Hanwha InvestmentSecuri vs. CU Medical Systems | Hanwha InvestmentSecuri vs. Display Tech Co |
| ATON vs. BGF Retail Co | ATON vs. Amogreentech Co | ATON vs. Hanwha InvestmentSecurities Co | ATON vs. NH Investment Securities |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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