Correlation Between Mirae Asset and HuMC
Can any of the company-specific risk be diversified away by investing in both Mirae Asset and HuMC 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 Mirae Asset and HuMC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirae Asset Daewoo and HuMC Co, you can compare the effects of market volatilities on Mirae Asset and HuMC 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 Mirae Asset with a short position of HuMC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirae Asset and HuMC.
Diversification Opportunities for Mirae Asset and HuMC
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mirae and HuMC is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Mirae Asset Daewoo and HuMC Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HuMC and Mirae Asset 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 Mirae Asset Daewoo are associated (or correlated) with HuMC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HuMC has no effect on the direction of Mirae Asset i.e., Mirae Asset and HuMC go up and down completely randomly.
Pair Corralation between Mirae Asset and HuMC
Assuming the 90 days trading horizon Mirae Asset Daewoo is expected to generate 8.4 times more return on investment than HuMC. However, Mirae Asset is 8.4 times more volatile than HuMC Co. It trades about 0.06 of its potential returns per unit of risk. HuMC Co is currently generating about -0.15 per unit of risk. If you would invest 425,500 in Mirae Asset Daewoo on September 1, 2024 and sell it today you would earn a total of 22,500 from holding Mirae Asset Daewoo or generate 5.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mirae Asset Daewoo vs. HuMC Co
Performance |
| Timeline |
| Mirae Asset Daewoo |
| HuMC |
Mirae Asset and HuMC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirae Asset and HuMC
The main advantage of trading using opposite Mirae Asset and HuMC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirae Asset position performs unexpectedly, HuMC 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 HuMC will offset losses from the drop in HuMC's long position.| Mirae Asset vs. Daol Investment Securities | Mirae Asset vs. Dongbang Transport Logistics | Mirae Asset vs. Shinsegae Engineering Construction | Mirae Asset vs. KEPCO Engineering Construction |
| HuMC vs. CKH Food Health | HuMC vs. Raontech | HuMC vs. Eagle Veterinary Technology | HuMC vs. LG Household Healthcare |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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