Correlation Between Hanwha Chemical and MEDIPOST
Can any of the company-specific risk be diversified away by investing in both Hanwha Chemical and MEDIPOST 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 Hanwha Chemical and MEDIPOST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanwha Chemical Corp and MEDIPOST Co, you can compare the effects of market volatilities on Hanwha Chemical and MEDIPOST 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 Hanwha Chemical with a short position of MEDIPOST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha Chemical and MEDIPOST.
Diversification Opportunities for Hanwha Chemical and MEDIPOST
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hanwha and MEDIPOST is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha Chemical Corp and MEDIPOST Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDIPOST and Hanwha 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 Hanwha Chemical Corp are associated (or correlated) with MEDIPOST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDIPOST has no effect on the direction of Hanwha Chemical i.e., Hanwha Chemical and MEDIPOST go up and down completely randomly.
Pair Corralation between Hanwha Chemical and MEDIPOST
Assuming the 90 days trading horizon Hanwha Chemical Corp is expected to generate 0.52 times more return on investment than MEDIPOST. However, Hanwha Chemical Corp is 1.93 times less risky than MEDIPOST. It trades about 0.21 of its potential returns per unit of risk. MEDIPOST Co is currently generating about -0.18 per unit of risk. If you would invest 1,653,327 in Hanwha Chemical Corp on October 14, 2024 and sell it today you would earn a total of 202,673 from holding Hanwha Chemical Corp or generate 12.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanwha Chemical Corp vs. MEDIPOST Co
Performance |
| Timeline |
| Hanwha Chemical Corp |
| MEDIPOST |
Hanwha Chemical and MEDIPOST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha Chemical and MEDIPOST
The main advantage of trading using opposite Hanwha Chemical and MEDIPOST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha Chemical position performs unexpectedly, MEDIPOST 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 MEDIPOST will offset losses from the drop in MEDIPOST's long position.| Hanwha Chemical vs. CKH Food Health | Hanwha Chemical vs. Samsung Electronics Co | Hanwha Chemical vs. SungMoon Electronics Co | Hanwha Chemical vs. Sajo Seafood |
| MEDIPOST vs. Daewon Chemical Co | MEDIPOST vs. Hanwha Chemical Corp | MEDIPOST vs. Daiyang Metal Co | MEDIPOST vs. DONGKUK TED METAL |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |