Correlation Between Playgram and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Playgram 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 Playgram and Haitai Confectionery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Playgram Co and Haitai Confectionery Foods, you can compare the effects of market volatilities on Playgram 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 Playgram with a short position of Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Playgram and Haitai Confectionery.
Diversification Opportunities for Playgram and Haitai Confectionery
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Playgram and Haitai is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Playgram 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 Playgram 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 Playgram 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 Playgram i.e., Playgram and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Playgram and Haitai Confectionery
Assuming the 90 days trading horizon Playgram Co is expected to generate 2.46 times more return on investment than Haitai Confectionery. However, Playgram is 2.46 times more volatile than Haitai Confectionery Foods. It trades about 0.02 of its potential returns per unit of risk. Haitai Confectionery Foods is currently generating about -0.07 per unit of risk. If you would invest 37,000 in Playgram Co on September 1, 2024 and sell it today you would lose (100.00) from holding Playgram Co or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Playgram Co vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Playgram |
| Haitai Confectionery |
Playgram and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Playgram and Haitai Confectionery
The main advantage of trading using opposite Playgram and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Playgram 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.| Playgram vs. PI Advanced Materials | Playgram vs. Youngchang Chemical Co | Playgram vs. Namhae Chemical | Playgram vs. Iljin Materials Co |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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