Correlation Between Hansol Homedeco and UJU Electronics
Can any of the company-specific risk be diversified away by investing in both Hansol Homedeco and UJU Electronics 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 Hansol Homedeco and UJU Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hansol Homedeco Co and UJU Electronics Co, you can compare the effects of market volatilities on Hansol Homedeco and UJU Electronics 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 Hansol Homedeco with a short position of UJU Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hansol Homedeco and UJU Electronics.
Diversification Opportunities for Hansol Homedeco and UJU Electronics
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hansol and UJU is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Hansol Homedeco Co and UJU Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UJU Electronics and Hansol Homedeco 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 Hansol Homedeco Co are associated (or correlated) with UJU Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UJU Electronics has no effect on the direction of Hansol Homedeco i.e., Hansol Homedeco and UJU Electronics go up and down completely randomly.
Pair Corralation between Hansol Homedeco and UJU Electronics
Assuming the 90 days trading horizon Hansol Homedeco Co is expected to generate 2.4 times more return on investment than UJU Electronics. However, Hansol Homedeco is 2.4 times more volatile than UJU Electronics Co. It trades about 0.32 of its potential returns per unit of risk. UJU Electronics Co is currently generating about 0.29 per unit of risk. If you would invest 66,100 in Hansol Homedeco Co on November 4, 2024 and sell it today you would earn a total of 34,500 from holding Hansol Homedeco Co or generate 52.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hansol Homedeco Co vs. UJU Electronics Co
Performance |
| Timeline |
| Hansol Homedeco |
| UJU Electronics |
Hansol Homedeco and UJU Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hansol Homedeco and UJU Electronics
The main advantage of trading using opposite Hansol Homedeco and UJU Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hansol Homedeco position performs unexpectedly, UJU Electronics 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 UJU Electronics will offset losses from the drop in UJU Electronics' long position.| Hansol Homedeco vs. Seoul Food Industrial | Hansol Homedeco vs. Daelim Trading Co | Hansol Homedeco vs. Stic Investments | Hansol Homedeco vs. FoodNamoo |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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