Correlation Between PLAYWITH and Nam Hwa
Can any of the company-specific risk be diversified away by investing in both PLAYWITH and Nam Hwa 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 PLAYWITH and Nam Hwa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYWITH and Nam Hwa Construction, you can compare the effects of market volatilities on PLAYWITH and Nam Hwa 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 PLAYWITH with a short position of Nam Hwa. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYWITH and Nam Hwa.
Diversification Opportunities for PLAYWITH and Nam Hwa
Good diversification
The 3 months correlation between PLAYWITH and Nam is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding PLAYWITH and Nam Hwa Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nam Hwa Construction and PLAYWITH 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 PLAYWITH are associated (or correlated) with Nam Hwa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nam Hwa Construction has no effect on the direction of PLAYWITH i.e., PLAYWITH and Nam Hwa go up and down completely randomly.
Pair Corralation between PLAYWITH and Nam Hwa
Assuming the 90 days trading horizon PLAYWITH is expected to under-perform the Nam Hwa. In addition to that, PLAYWITH is 1.82 times more volatile than Nam Hwa Construction. It trades about -0.08 of its total potential returns per unit of risk. Nam Hwa Construction is currently generating about -0.02 per unit of volatility. If you would invest 474,500 in Nam Hwa Construction on September 27, 2024 and sell it today you would lose (48,500) from holding Nam Hwa Construction or give up 10.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAYWITH vs. Nam Hwa Construction
Performance |
| Timeline |
| PLAYWITH |
| Nam Hwa Construction |
PLAYWITH and Nam Hwa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYWITH and Nam Hwa
The main advantage of trading using opposite PLAYWITH and Nam Hwa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYWITH position performs unexpectedly, Nam Hwa 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 Nam Hwa will offset losses from the drop in Nam Hwa's long position.| PLAYWITH vs. Nam Hwa Construction | PLAYWITH vs. Lotte Data Communication | PLAYWITH vs. Polaris Office Corp | PLAYWITH vs. Seohee Construction Co |
| Nam Hwa vs. Busan Industrial Co | Nam Hwa vs. Busan Ind | Nam Hwa vs. Mirae Asset Daewoo | Nam Hwa vs. Shinhan WTI Futures |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |