Correlation Between Youngbo Chemical and Hanjin Transportation
Can any of the company-specific risk be diversified away by investing in both Youngbo Chemical and Hanjin Transportation 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 Youngbo Chemical and Hanjin Transportation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Youngbo Chemical Co and Hanjin Transportation Co, you can compare the effects of market volatilities on Youngbo Chemical and Hanjin Transportation 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 Youngbo Chemical with a short position of Hanjin Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youngbo Chemical and Hanjin Transportation.
Diversification Opportunities for Youngbo Chemical and Hanjin Transportation
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Youngbo and Hanjin is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Youngbo Chemical Co and Hanjin Transportation Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanjin Transportation and Youngbo Chemical 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 Youngbo Chemical Co are associated (or correlated) with Hanjin Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanjin Transportation has no effect on the direction of Youngbo Chemical i.e., Youngbo Chemical and Hanjin Transportation go up and down completely randomly.
Pair Corralation between Youngbo Chemical and Hanjin Transportation
Assuming the 90 days trading horizon Youngbo Chemical Co is expected to generate 0.74 times more return on investment than Hanjin Transportation. However, Youngbo Chemical Co is 1.35 times less risky than Hanjin Transportation. It trades about 0.06 of its potential returns per unit of risk. Hanjin Transportation Co is currently generating about 0.03 per unit of risk. If you would invest 345,605 in Youngbo Chemical Co on October 22, 2024 and sell it today you would earn a total of 27,395 from holding Youngbo Chemical Co or generate 7.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youngbo Chemical Co vs. Hanjin Transportation Co
Performance |
| Timeline |
| Youngbo Chemical |
| Hanjin Transportation |
Youngbo Chemical and Hanjin Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youngbo Chemical and Hanjin Transportation
The main advantage of trading using opposite Youngbo Chemical and Hanjin Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youngbo Chemical position performs unexpectedly, Hanjin Transportation 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 Hanjin Transportation will offset losses from the drop in Hanjin Transportation's long position.| Youngbo Chemical vs. Korea Information Communications | Youngbo Chemical vs. Korea Investment Holdings | Youngbo Chemical vs. DB Financial Investment | Youngbo Chemical vs. Daol Investment Securities |
| Hanjin Transportation vs. Cuckoo Homesys Co | Hanjin Transportation vs. Hankook Furniture Co | Hanjin Transportation vs. Ecoplastic | Hanjin Transportation vs. Daejoo Electronic Materials |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |