Correlation Between NH Investment and J Steel
Can any of the company-specific risk be diversified away by investing in both NH Investment and J Steel 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 NH Investment and J Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NH Investment Securities and J Steel Co, you can compare the effects of market volatilities on NH Investment and J Steel 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 NH Investment with a short position of J Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Investment and J Steel.
Diversification Opportunities for NH Investment and J Steel
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 005940 and 023440 is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding NH Investment Securities and J Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Steel and NH Investment 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 NH Investment Securities are associated (or correlated) with J Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Steel has no effect on the direction of NH Investment i.e., NH Investment and J Steel go up and down completely randomly.
Pair Corralation between NH Investment and J Steel
Assuming the 90 days trading horizon NH Investment Securities is expected to generate 0.39 times more return on investment than J Steel. However, NH Investment Securities is 2.54 times less risky than J Steel. It trades about 0.08 of its potential returns per unit of risk. J Steel Co is currently generating about 0.03 per unit of risk. If you would invest 1,271,000 in NH Investment Securities on November 3, 2024 and sell it today you would earn a total of 173,000 from holding NH Investment Securities or generate 13.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NH Investment Securities vs. J Steel Co
Performance |
| Timeline |
| NH Investment Securities |
| J Steel |
NH Investment and J Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NH Investment and J Steel
The main advantage of trading using opposite NH Investment and J Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NH Investment position performs unexpectedly, J Steel 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 J Steel will offset losses from the drop in J Steel's long position.| NH Investment vs. TS Investment Corp | NH Investment vs. Stic Investments | NH Investment vs. Daol Investment Securities | NH Investment vs. Infinitt Healthcare Co |
| J Steel vs. Samsung Electronics Co | J Steel vs. Samsung Electronics Co | J Steel vs. LG Energy Solution | J Steel vs. SK Hynix |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |