Correlation Between Myoung Shin and Hansol Inticube
Can any of the company-specific risk be diversified away by investing in both Myoung Shin and Hansol Inticube 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 Myoung Shin and Hansol Inticube into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Myoung Shin Industrial and Hansol Inticube Co, you can compare the effects of market volatilities on Myoung Shin and Hansol Inticube 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 Myoung Shin with a short position of Hansol Inticube. Check out your portfolio center. Please also check ongoing floating volatility patterns of Myoung Shin and Hansol Inticube.
Diversification Opportunities for Myoung Shin and Hansol Inticube
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Myoung and Hansol is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Myoung Shin Industrial and Hansol Inticube Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansol Inticube and Myoung Shin 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 Myoung Shin Industrial are associated (or correlated) with Hansol Inticube. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansol Inticube has no effect on the direction of Myoung Shin i.e., Myoung Shin and Hansol Inticube go up and down completely randomly.
Pair Corralation between Myoung Shin and Hansol Inticube
Assuming the 90 days trading horizon Myoung Shin Industrial is expected to under-perform the Hansol Inticube. But the stock apears to be less risky and, when comparing its historical volatility, Myoung Shin Industrial is 1.26 times less risky than Hansol Inticube. The stock trades about -0.05 of its potential returns per unit of risk. The Hansol Inticube Co is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 178,300 in Hansol Inticube Co on August 31, 2024 and sell it today you would lose (77,600) from holding Hansol Inticube Co or give up 43.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Myoung Shin Industrial vs. Hansol Inticube Co
Performance |
| Timeline |
| Myoung Shin Industrial |
| Hansol Inticube |
Myoung Shin and Hansol Inticube Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Myoung Shin and Hansol Inticube
The main advantage of trading using opposite Myoung Shin and Hansol Inticube positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Myoung Shin position performs unexpectedly, Hansol Inticube 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 Hansol Inticube will offset losses from the drop in Hansol Inticube's long position.| Myoung Shin vs. CKH Food Health | Myoung Shin vs. Shinsegae Food | Myoung Shin vs. ABOV Semiconductor Co | Myoung Shin vs. ENERGYMACHINERY KOREA CoLtd |
| Hansol Inticube vs. Myoung Shin Industrial | Hansol Inticube vs. Namhwa Industrial Co | Hansol Inticube vs. Daiyang Metal Co | Hansol Inticube vs. PJ Metal Co |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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