Correlation Between Heungkuk Metaltech and Settlebank
Can any of the company-specific risk be diversified away by investing in both Heungkuk Metaltech and Settlebank 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 Settlebank 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 Settlebank, you can compare the effects of market volatilities on Heungkuk Metaltech and Settlebank 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 Settlebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heungkuk Metaltech and Settlebank.
Diversification Opportunities for Heungkuk Metaltech and Settlebank
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Heungkuk and Settlebank is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Heungkuk Metaltech CoLtd and Settlebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Settlebank 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 Settlebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Settlebank has no effect on the direction of Heungkuk Metaltech i.e., Heungkuk Metaltech and Settlebank go up and down completely randomly.
Pair Corralation between Heungkuk Metaltech and Settlebank
Assuming the 90 days trading horizon Heungkuk Metaltech CoLtd is expected to generate 0.53 times more return on investment than Settlebank. However, Heungkuk Metaltech CoLtd is 1.87 times less risky than Settlebank. It trades about 0.0 of its potential returns per unit of risk. Settlebank is currently generating about -0.02 per unit of risk. If you would invest 581,323 in Heungkuk Metaltech CoLtd on October 17, 2024 and sell it today you would lose (52,323) from holding Heungkuk Metaltech CoLtd or give up 9.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heungkuk Metaltech CoLtd vs. Settlebank
Performance |
| Timeline |
| Heungkuk Metaltech CoLtd |
| Settlebank |
Heungkuk Metaltech and Settlebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heungkuk Metaltech and Settlebank
The main advantage of trading using opposite Heungkuk Metaltech and Settlebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heungkuk Metaltech position performs unexpectedly, Settlebank 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 Settlebank will offset losses from the drop in Settlebank's long position.| Heungkuk Metaltech vs. Aprogen Healthcare Games | Heungkuk Metaltech vs. GS Engineering Construction | Heungkuk Metaltech vs. Miwon Chemicals Co | Heungkuk Metaltech vs. Hannong Chemicals |
| Settlebank vs. Choil Aluminum | Settlebank vs. Heungkuk Metaltech CoLtd | Settlebank vs. Daiyang Metal Co | Settlebank vs. Korea Shipbuilding Offshore |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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