Correlation Between Hansol Homedeco and CKH Food
Can any of the company-specific risk be diversified away by investing in both Hansol Homedeco and CKH Food 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 CKH Food 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 CKH Food Health, you can compare the effects of market volatilities on Hansol Homedeco and CKH Food 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 CKH Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hansol Homedeco and CKH Food.
Diversification Opportunities for Hansol Homedeco and CKH Food
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hansol and CKH is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Hansol Homedeco Co and CKH Food Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKH Food Health 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 CKH Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKH Food Health has no effect on the direction of Hansol Homedeco i.e., Hansol Homedeco and CKH Food go up and down completely randomly.
Pair Corralation between Hansol Homedeco and CKH Food
Assuming the 90 days trading horizon Hansol Homedeco Co is expected to generate 4.45 times more return on investment than CKH Food. However, Hansol Homedeco is 4.45 times more volatile than CKH Food Health. It trades about 0.38 of its potential returns per unit of risk. CKH Food Health is currently generating about -0.13 per unit of risk. If you would invest 64,300 in Hansol Homedeco Co on October 30, 2024 and sell it today you would earn a total of 43,200 from holding Hansol Homedeco Co or generate 67.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hansol Homedeco Co vs. CKH Food Health
Performance |
| Timeline |
| Hansol Homedeco |
| CKH Food Health |
Hansol Homedeco and CKH Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hansol Homedeco and CKH Food
The main advantage of trading using opposite Hansol Homedeco and CKH Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hansol Homedeco position performs unexpectedly, CKH Food 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 CKH Food will offset losses from the drop in CKH Food's long position.| Hansol Homedeco vs. KakaoBank Corp | Hansol Homedeco vs. Seoul Food Industrial | Hansol Homedeco vs. FOODWELL Co | Hansol Homedeco vs. Lotte Non Life Insurance |
| CKH Food vs. SAMG Entertainment Co | CKH Food vs. SK Chemicals Co | CKH Food vs. Barunson Entertainment Arts | CKH Food vs. SM Entertainment 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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