Correlation Between Samhyun Steel and Hanil Chemical
Can any of the company-specific risk be diversified away by investing in both Samhyun Steel and Hanil Chemical 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 Samhyun Steel and Hanil Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samhyun Steel Co and Hanil Chemical Ind, you can compare the effects of market volatilities on Samhyun Steel and Hanil Chemical 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 Samhyun Steel with a short position of Hanil Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhyun Steel and Hanil Chemical.
Diversification Opportunities for Samhyun Steel and Hanil Chemical
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samhyun and Hanil is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Samhyun Steel Co and Hanil Chemical Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanil Chemical Ind and Samhyun Steel 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 Samhyun Steel Co are associated (or correlated) with Hanil Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanil Chemical Ind has no effect on the direction of Samhyun Steel i.e., Samhyun Steel and Hanil Chemical go up and down completely randomly.
Pair Corralation between Samhyun Steel and Hanil Chemical
Assuming the 90 days trading horizon Samhyun Steel Co is expected to generate 0.7 times more return on investment than Hanil Chemical. However, Samhyun Steel Co is 1.43 times less risky than Hanil Chemical. It trades about 0.0 of its potential returns per unit of risk. Hanil Chemical Ind is currently generating about -0.08 per unit of risk. If you would invest 480,189 in Samhyun Steel Co on September 14, 2024 and sell it today you would lose (8,189) from holding Samhyun Steel Co or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samhyun Steel Co vs. Hanil Chemical Ind
Performance |
| Timeline |
| Samhyun Steel |
| Hanil Chemical Ind |
Samhyun Steel and Hanil Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhyun Steel and Hanil Chemical
The main advantage of trading using opposite Samhyun Steel and Hanil Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhyun Steel position performs unexpectedly, Hanil Chemical 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 Hanil Chemical will offset losses from the drop in Hanil Chemical's long position.| Samhyun Steel vs. Keum Kang Steel | Samhyun Steel vs. Gyeongnam Steel Co | Samhyun Steel vs. Jeil Steel Mfg | Samhyun Steel vs. Wonil Special Steel |
| Hanil Chemical vs. Polaris Office Corp | Hanil Chemical vs. Samhyun Steel Co | Hanil Chemical vs. Wonil Special Steel | Hanil Chemical vs. Innowireless 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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