Correlation Between Heungkuk Metaltech and Korea Zinc
Can any of the company-specific risk be diversified away by investing in both Heungkuk Metaltech and Korea Zinc 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 Heungkuk Metaltech and Korea Zinc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heungkuk Metaltech CoLtd and Korea Zinc, you can compare the effects of market volatilities on Heungkuk Metaltech and Korea Zinc 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 Heungkuk Metaltech with a short position of Korea Zinc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heungkuk Metaltech and Korea Zinc.
Diversification Opportunities for Heungkuk Metaltech and Korea Zinc
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Heungkuk and Korea is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Heungkuk Metaltech CoLtd and Korea Zinc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Zinc and Heungkuk Metaltech 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 Heungkuk Metaltech CoLtd are associated (or correlated) with Korea Zinc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Zinc has no effect on the direction of Heungkuk Metaltech i.e., Heungkuk Metaltech and Korea Zinc go up and down completely randomly.
Pair Corralation between Heungkuk Metaltech and Korea Zinc
Assuming the 90 days trading horizon Heungkuk Metaltech CoLtd is expected to under-perform the Korea Zinc. But the stock apears to be less risky and, when comparing its historical volatility, Heungkuk Metaltech CoLtd is 1.71 times less risky than Korea Zinc. The stock trades about -0.03 of its potential returns per unit of risk. The Korea Zinc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 100,000,000 in Korea Zinc on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Korea Zinc or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heungkuk Metaltech CoLtd vs. Korea Zinc
Performance |
| Timeline |
| Heungkuk Metaltech CoLtd |
| Korea Zinc |
Heungkuk Metaltech and Korea Zinc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heungkuk Metaltech and Korea Zinc
The main advantage of trading using opposite Heungkuk Metaltech and Korea Zinc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heungkuk Metaltech position performs unexpectedly, Korea Zinc 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 Korea Zinc will offset losses from the drop in Korea Zinc's long position.| Heungkuk Metaltech vs. Daewoo Engineering Construction | Heungkuk Metaltech vs. DataSolution | Heungkuk Metaltech vs. Seohee Construction Co | Heungkuk Metaltech vs. Air Busan Co |
| Korea Zinc vs. Dongbu Steel Co | Korea Zinc vs. Heungkuk Metaltech CoLtd | Korea Zinc vs. Fine Besteel Co | Korea Zinc vs. Dong A Steel Technology |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |