Correlation Between HMM and Namu Tech
Can any of the company-specific risk be diversified away by investing in both HMM and Namu Tech 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 Namu Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HMM Co and Namu Tech CoLtd, you can compare the effects of market volatilities on HMM and Namu Tech 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 Namu Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of HMM and Namu Tech.
Diversification Opportunities for HMM and Namu Tech
Very good diversification
The 3 months correlation between HMM and Namu is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding HMM Co and Namu Tech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Namu Tech CoLtd 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 Namu Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Namu Tech CoLtd has no effect on the direction of HMM i.e., HMM and Namu Tech go up and down completely randomly.
Pair Corralation between HMM and Namu Tech
Assuming the 90 days trading horizon HMM Co is expected to generate 0.66 times more return on investment than Namu Tech. However, HMM Co is 1.52 times less risky than Namu Tech. It trades about 0.04 of its potential returns per unit of risk. Namu Tech CoLtd is currently generating about -0.06 per unit of risk. If you would invest 1,690,000 in HMM Co on September 21, 2024 and sell it today you would earn a total of 107,000 from holding HMM Co or generate 6.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.02% |
| Values | Daily Returns |
HMM Co vs. Namu Tech CoLtd
Performance |
| Timeline |
| HMM Co |
| Namu Tech CoLtd |
HMM and Namu Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HMM and Namu Tech
The main advantage of trading using opposite HMM and Namu Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HMM position performs unexpectedly, Namu Tech 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 Namu Tech will offset losses from the drop in Namu Tech's long position.| HMM vs. Korea New Network | HMM vs. Solution Advanced Technology | HMM vs. Busan Industrial Co | HMM vs. Busan Ind |
| Namu Tech vs. Samick Musical Instruments | Namu Tech vs. Eagle Veterinary Technology | Namu Tech vs. Cheryong Industrial CoLtd | Namu Tech vs. Kyeryong Construction Industrial |
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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