Correlation Between Nh Investment and Hankook Furniture
Can any of the company-specific risk be diversified away by investing in both Nh Investment and Hankook Furniture 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 Hankook Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nh Investment And and Hankook Furniture Co, you can compare the effects of market volatilities on Nh Investment and Hankook Furniture 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 Hankook Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nh Investment and Hankook Furniture.
Diversification Opportunities for Nh Investment and Hankook Furniture
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between 005945 and Hankook is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Nh Investment And and Hankook Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hankook Furniture 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 And are associated (or correlated) with Hankook Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hankook Furniture has no effect on the direction of Nh Investment i.e., Nh Investment and Hankook Furniture go up and down completely randomly.
Pair Corralation between Nh Investment and Hankook Furniture
Assuming the 90 days trading horizon Nh Investment And is expected to under-perform the Hankook Furniture. But the stock apears to be less risky and, when comparing its historical volatility, Nh Investment And is 4.37 times less risky than Hankook Furniture. The stock trades about -0.03 of its potential returns per unit of risk. The Hankook Furniture Co is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 369,500 in Hankook Furniture Co on August 28, 2024 and sell it today you would earn a total of 38,000 from holding Hankook Furniture Co or generate 10.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nh Investment And vs. Hankook Furniture Co
Performance |
| Timeline |
| Nh Investment And |
| Hankook Furniture |
Nh Investment and Hankook Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nh Investment and Hankook Furniture
The main advantage of trading using opposite Nh Investment and Hankook Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nh Investment position performs unexpectedly, Hankook Furniture 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 Hankook Furniture will offset losses from the drop in Hankook Furniture's long position.| Nh Investment vs. DB Financial Investment | Nh Investment vs. BNK Financial Group | Nh Investment vs. DB Insurance Co | Nh Investment vs. E Investment Development |
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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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