Correlation Between Hanil Chemical and Youngbo Chemical
Can any of the company-specific risk be diversified away by investing in both Hanil Chemical and Youngbo Chemical 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 Hanil Chemical and Youngbo Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanil Chemical Ind and Youngbo Chemical Co, you can compare the effects of market volatilities on Hanil Chemical and Youngbo Chemical 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 Hanil Chemical with a short position of Youngbo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanil Chemical and Youngbo Chemical.
Diversification Opportunities for Hanil Chemical and Youngbo Chemical
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hanil and Youngbo is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Hanil Chemical Ind and Youngbo Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngbo Chemical and Hanil 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 Hanil Chemical Ind are associated (or correlated) with Youngbo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngbo Chemical has no effect on the direction of Hanil Chemical i.e., Hanil Chemical and Youngbo Chemical go up and down completely randomly.
Pair Corralation between Hanil Chemical and Youngbo Chemical
Assuming the 90 days trading horizon Hanil Chemical Ind is expected to under-perform the Youngbo Chemical. In addition to that, Hanil Chemical is 2.51 times more volatile than Youngbo Chemical Co. It trades about -0.01 of its total potential returns per unit of risk. Youngbo Chemical Co is currently generating about 0.01 per unit of volatility. If you would invest 352,993 in Youngbo Chemical Co on October 7, 2024 and sell it today you would earn a total of 19,507 from holding Youngbo Chemical Co or generate 5.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanil Chemical Ind vs. Youngbo Chemical Co
Performance |
| Timeline |
| Hanil Chemical Ind |
| Youngbo Chemical |
Hanil Chemical and Youngbo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanil Chemical and Youngbo Chemical
The main advantage of trading using opposite Hanil Chemical and Youngbo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanil Chemical position performs unexpectedly, Youngbo Chemical 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 Youngbo Chemical will offset losses from the drop in Youngbo Chemical's long position.| Hanil Chemical vs. LG Chemicals | Hanil Chemical vs. POSCO Holdings | Hanil Chemical vs. Hanwha Solutions | Hanil Chemical vs. Lotte Chemical Corp |
| Youngbo Chemical vs. AptaBio Therapeutics | Youngbo Chemical vs. Daewoo SBI SPAC | Youngbo Chemical vs. Dream Security co | Youngbo Chemical 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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