Correlation Between HMM and Hwashin Precision
Can any of the company-specific risk be diversified away by investing in both HMM and Hwashin Precision 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 HMM and Hwashin Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HMM Co and Hwashin Precision Engineering, you can compare the effects of market volatilities on HMM and Hwashin Precision 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 HMM with a short position of Hwashin Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of HMM and Hwashin Precision.
Diversification Opportunities for HMM and Hwashin Precision
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HMM and Hwashin is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding HMM Co and Hwashin Precision Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hwashin Precision and HMM 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 HMM Co are associated (or correlated) with Hwashin Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hwashin Precision has no effect on the direction of HMM i.e., HMM and Hwashin Precision go up and down completely randomly.
Pair Corralation between HMM and Hwashin Precision
Assuming the 90 days trading horizon HMM Co is expected to generate 1.83 times more return on investment than Hwashin Precision. However, HMM is 1.83 times more volatile than Hwashin Precision Engineering. It trades about 0.06 of its potential returns per unit of risk. Hwashin Precision Engineering is currently generating about -0.18 per unit of risk. If you would invest 1,690,000 in HMM Co on September 3, 2024 and sell it today you would earn a total of 106,000 from holding HMM Co or generate 6.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HMM Co vs. Hwashin Precision Engineering
Performance |
| Timeline |
| HMM Co |
| Hwashin Precision |
HMM and Hwashin Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HMM and Hwashin Precision
The main advantage of trading using opposite HMM and Hwashin Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HMM position performs unexpectedly, Hwashin Precision 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 Hwashin Precision will offset losses from the drop in Hwashin Precision's long position.| HMM vs. Daeduck Electronics Co | HMM vs. DB Financial Investment | HMM vs. Shinil Electronics Co | HMM vs. Samyoung Electronics Co |
| Hwashin Precision vs. PI Advanced Materials | Hwashin Precision vs. Daeduck Electronics Co | Hwashin Precision vs. Sunny Electronics Corp | Hwashin Precision vs. Iljin Materials 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |