Correlation Between Hankuk Steel and Bookook Steel
Can any of the company-specific risk be diversified away by investing in both Hankuk Steel and Bookook Steel 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 Hankuk Steel and Bookook Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hankuk Steel Wire and Bookook Steel, you can compare the effects of market volatilities on Hankuk Steel and Bookook Steel 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 Hankuk Steel with a short position of Bookook Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hankuk Steel and Bookook Steel.
Diversification Opportunities for Hankuk Steel and Bookook Steel
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hankuk and Bookook is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hankuk Steel Wire and Bookook Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bookook Steel and Hankuk 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 Hankuk Steel Wire are associated (or correlated) with Bookook Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bookook Steel has no effect on the direction of Hankuk Steel i.e., Hankuk Steel and Bookook Steel go up and down completely randomly.
Pair Corralation between Hankuk Steel and Bookook Steel
Assuming the 90 days trading horizon Hankuk Steel Wire is expected to generate 0.98 times more return on investment than Bookook Steel. However, Hankuk Steel Wire is 1.02 times less risky than Bookook Steel. It trades about 0.03 of its potential returns per unit of risk. Bookook Steel is currently generating about -0.1 per unit of risk. If you would invest 287,000 in Hankuk Steel Wire on September 1, 2024 and sell it today you would earn a total of 3,000 from holding Hankuk Steel Wire or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hankuk Steel Wire vs. Bookook Steel
Performance |
| Timeline |
| Hankuk Steel Wire |
| Bookook Steel |
Hankuk Steel and Bookook Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hankuk Steel and Bookook Steel
The main advantage of trading using opposite Hankuk Steel and Bookook Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hankuk Steel position performs unexpectedly, Bookook Steel 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 Bookook Steel will offset losses from the drop in Bookook Steel's long position.| Hankuk Steel vs. TS Investment Corp | Hankuk Steel vs. Atinum Investment Co | Hankuk Steel vs. Mobile Appliance | Hankuk Steel vs. Mobileleader CoLtd |
| Bookook Steel vs. Settlebank | Bookook Steel vs. DB Financial Investment | Bookook Steel vs. PJ Electronics Co | Bookook Steel vs. Korea Electronic Certification |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Transaction History View history of all your transactions and understand their impact on performance |