Correlation Between Nh Investment and Union Materials
Can any of the company-specific risk be diversified away by investing in both Nh Investment and Union Materials 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 Union Materials 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 Union Materials Corp, you can compare the effects of market volatilities on Nh Investment and Union Materials 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 Union Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nh Investment and Union Materials.
Diversification Opportunities for Nh Investment and Union Materials
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 005945 and Union is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Nh Investment And and Union Materials Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Materials 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 Union Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Materials Corp has no effect on the direction of Nh Investment i.e., Nh Investment and Union Materials go up and down completely randomly.
Pair Corralation between Nh Investment and Union Materials
Assuming the 90 days trading horizon Nh Investment And is expected to generate 0.18 times more return on investment than Union Materials. However, Nh Investment And is 5.44 times less risky than Union Materials. It trades about 0.11 of its potential returns per unit of risk. Union Materials Corp is currently generating about 0.01 per unit of risk. If you would invest 835,330 in Nh Investment And on September 1, 2024 and sell it today you would earn a total of 372,670 from holding Nh Investment And or generate 44.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nh Investment And vs. Union Materials Corp
Performance |
| Timeline |
| Nh Investment And |
| Union Materials Corp |
Nh Investment and Union Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nh Investment and Union Materials
The main advantage of trading using opposite Nh Investment and Union Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nh Investment position performs unexpectedly, Union Materials 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 Union Materials will offset losses from the drop in Union Materials' long position.| Nh Investment vs. Hanwha InvestmentSecurities Co | Nh Investment vs. Solution Advanced Technology | Nh Investment vs. Busan Industrial Co | Nh Investment vs. Busan Ind |
| Union Materials vs. LG Display | Union Materials vs. Hyundai Motor | Union Materials vs. Hyundai Motor Co | Union Materials vs. Hyundai Motor Co |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| CEOs Directory Screen CEOs from public companies around the world |