Correlation Between Kukdo Chemical and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Kukdo Chemical and Haitai Confectionery 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 Kukdo Chemical and Haitai Confectionery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kukdo Chemical Co and Haitai Confectionery Foods, you can compare the effects of market volatilities on Kukdo Chemical and Haitai Confectionery 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 Kukdo Chemical with a short position of Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukdo Chemical and Haitai Confectionery.
Diversification Opportunities for Kukdo Chemical and Haitai Confectionery
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kukdo and Haitai is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Kukdo Chemical Co and Haitai Confectionery Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haitai Confectionery and Kukdo Chemical 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 Kukdo Chemical Co are associated (or correlated) with Haitai Confectionery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haitai Confectionery has no effect on the direction of Kukdo Chemical i.e., Kukdo Chemical and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Kukdo Chemical and Haitai Confectionery
Assuming the 90 days trading horizon Kukdo Chemical Co is expected to under-perform the Haitai Confectionery. But the stock apears to be less risky and, when comparing its historical volatility, Kukdo Chemical Co is 1.14 times less risky than Haitai Confectionery. The stock trades about -0.03 of its potential returns per unit of risk. The Haitai Confectionery Foods is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 605,013 in Haitai Confectionery Foods on September 2, 2024 and sell it today you would lose (34,013) from holding Haitai Confectionery Foods or give up 5.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukdo Chemical Co vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Kukdo Chemical |
| Haitai Confectionery |
Kukdo Chemical and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukdo Chemical and Haitai Confectionery
The main advantage of trading using opposite Kukdo Chemical and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukdo Chemical position performs unexpectedly, Haitai Confectionery 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 Haitai Confectionery will offset losses from the drop in Haitai Confectionery's long position.| Kukdo Chemical vs. AptaBio Therapeutics | Kukdo Chemical vs. Daewoo SBI SPAC | Kukdo Chemical vs. Dream Security co | Kukdo Chemical vs. Microfriend |
| Haitai Confectionery vs. AptaBio Therapeutics | Haitai Confectionery vs. Daewoo SBI SPAC | Haitai Confectionery vs. Dream Security co | Haitai Confectionery vs. Microfriend |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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