Correlation Between Heungkuk Metaltech and SHINWON STRUCTION
Can any of the company-specific risk be diversified away by investing in both Heungkuk Metaltech and SHINWON STRUCTION 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 SHINWON STRUCTION 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 SHINWON STRUCTION COMPANY, you can compare the effects of market volatilities on Heungkuk Metaltech and SHINWON STRUCTION 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 SHINWON STRUCTION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heungkuk Metaltech and SHINWON STRUCTION.
Diversification Opportunities for Heungkuk Metaltech and SHINWON STRUCTION
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Heungkuk and SHINWON is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Heungkuk Metaltech CoLtd and SHINWON STRUCTION COMPANY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHINWON STRUCTION PANY 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 SHINWON STRUCTION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHINWON STRUCTION PANY has no effect on the direction of Heungkuk Metaltech i.e., Heungkuk Metaltech and SHINWON STRUCTION go up and down completely randomly.
Pair Corralation between Heungkuk Metaltech and SHINWON STRUCTION
Assuming the 90 days trading horizon Heungkuk Metaltech CoLtd is expected to generate 0.23 times more return on investment than SHINWON STRUCTION. However, Heungkuk Metaltech CoLtd is 4.41 times less risky than SHINWON STRUCTION. It trades about -0.04 of its potential returns per unit of risk. SHINWON STRUCTION COMPANY is currently generating about -0.07 per unit of risk. If you would invest 492,500 in Heungkuk Metaltech CoLtd on September 3, 2024 and sell it today you would lose (12,500) from holding Heungkuk Metaltech CoLtd or give up 2.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heungkuk Metaltech CoLtd vs. SHINWON STRUCTION COMPANY
Performance |
| Timeline |
| Heungkuk Metaltech CoLtd |
| SHINWON STRUCTION PANY |
Heungkuk Metaltech and SHINWON STRUCTION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heungkuk Metaltech and SHINWON STRUCTION
The main advantage of trading using opposite Heungkuk Metaltech and SHINWON STRUCTION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heungkuk Metaltech position performs unexpectedly, SHINWON STRUCTION 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 SHINWON STRUCTION will offset losses from the drop in SHINWON STRUCTION'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 |
| SHINWON STRUCTION vs. Kbi Metal Co | SHINWON STRUCTION vs. Cots Technology Co | SHINWON STRUCTION vs. Pungguk Ethanol Industrial | SHINWON STRUCTION vs. Daou 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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