Correlation Between Mobase Electronics and HANA Micron
Can any of the company-specific risk be diversified away by investing in both Mobase Electronics and HANA Micron 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 Mobase Electronics and HANA Micron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mobase Electronics CoLtd and HANA Micron, you can compare the effects of market volatilities on Mobase Electronics and HANA Micron 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 Mobase Electronics with a short position of HANA Micron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobase Electronics and HANA Micron.
Diversification Opportunities for Mobase Electronics and HANA Micron
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mobase and HANA is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Mobase Electronics CoLtd and HANA Micron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANA Micron and Mobase Electronics 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 Mobase Electronics CoLtd are associated (or correlated) with HANA Micron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANA Micron has no effect on the direction of Mobase Electronics i.e., Mobase Electronics and HANA Micron go up and down completely randomly.
Pair Corralation between Mobase Electronics and HANA Micron
Assuming the 90 days trading horizon Mobase Electronics CoLtd is expected to generate 0.53 times more return on investment than HANA Micron. However, Mobase Electronics CoLtd is 1.89 times less risky than HANA Micron. It trades about -0.4 of its potential returns per unit of risk. HANA Micron is currently generating about -0.26 per unit of risk. If you would invest 178,500 in Mobase Electronics CoLtd on September 1, 2024 and sell it today you would lose (21,100) from holding Mobase Electronics CoLtd or give up 11.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Mobase Electronics CoLtd vs. HANA Micron
Performance |
| Timeline |
| Mobase Electronics CoLtd |
| HANA Micron |
Mobase Electronics and HANA Micron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mobase Electronics and HANA Micron
The main advantage of trading using opposite Mobase Electronics and HANA Micron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mobase Electronics position performs unexpectedly, HANA Micron 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 HANA Micron will offset losses from the drop in HANA Micron's long position.| Mobase Electronics vs. LG Display | Mobase Electronics vs. Hyundai Motor | Mobase Electronics vs. Hyundai Motor Co | Mobase Electronics vs. Hyundai Motor Co |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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