Correlation Between Nh Investment and Lotte Corp
Can any of the company-specific risk be diversified away by investing in both Nh Investment and Lotte Corp 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 Lotte Corp 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 Lotte Corp, you can compare the effects of market volatilities on Nh Investment and Lotte Corp 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 Lotte Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nh Investment and Lotte Corp.
Diversification Opportunities for Nh Investment and Lotte Corp
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 005945 and Lotte is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Nh Investment And and Lotte Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Corp 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 Lotte Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Corp has no effect on the direction of Nh Investment i.e., Nh Investment and Lotte Corp go up and down completely randomly.
Pair Corralation between Nh Investment and Lotte Corp
Assuming the 90 days trading horizon Nh Investment And is expected to generate 0.45 times more return on investment than Lotte Corp. However, Nh Investment And is 2.21 times less risky than Lotte Corp. It trades about 0.07 of its potential returns per unit of risk. Lotte Corp is currently generating about -0.17 per unit of risk. If you would invest 1,190,000 in Nh Investment And on September 12, 2024 and sell it today you would earn a total of 20,000 from holding Nh Investment And or generate 1.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Nh Investment And vs. Lotte Corp
Performance |
| Timeline |
| Nh Investment And |
| Lotte Corp |
Nh Investment and Lotte Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nh Investment and Lotte Corp
The main advantage of trading using opposite Nh Investment and Lotte Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nh Investment position performs unexpectedly, Lotte Corp 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 Lotte Corp will offset losses from the drop in Lotte Corp's long position.| Nh Investment vs. Hanwha InvestmentSecurities Co | Nh Investment vs. DSC Investment | Nh Investment vs. Solution Advanced Technology | Nh Investment vs. Busan Industrial Co |
| Lotte Corp vs. Hannong Chemicals | Lotte Corp vs. Semyung Electric Machinery | Lotte Corp vs. Hansol Chemical Co | Lotte Corp vs. LG Chemicals |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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