Correlation Between Hankook Steel and A Tech
Can any of the company-specific risk be diversified away by investing in both Hankook Steel and A Tech 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 Hankook Steel and A Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hankook Steel Co and A Tech Solution Co, you can compare the effects of market volatilities on Hankook Steel and A Tech 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 Hankook Steel with a short position of A Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hankook Steel and A Tech.
Diversification Opportunities for Hankook Steel and A Tech
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hankook and 071670 is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Hankook Steel Co and A Tech Solution Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Tech Solution and Hankook 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 Hankook Steel Co are associated (or correlated) with A Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Tech Solution has no effect on the direction of Hankook Steel i.e., Hankook Steel and A Tech go up and down completely randomly.
Pair Corralation between Hankook Steel and A Tech
Assuming the 90 days trading horizon Hankook Steel Co is expected to under-perform the A Tech. But the stock apears to be less risky and, when comparing its historical volatility, Hankook Steel Co is 2.12 times less risky than A Tech. The stock trades about -0.16 of its potential returns per unit of risk. The A Tech Solution Co is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 553,000 in A Tech Solution Co on October 29, 2024 and sell it today you would earn a total of 39,000 from holding A Tech Solution Co or generate 7.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hankook Steel Co vs. A Tech Solution Co
Performance |
| Timeline |
| Hankook Steel |
| A Tech Solution |
Hankook Steel and A Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hankook Steel and A Tech
The main advantage of trading using opposite Hankook Steel and A Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hankook Steel position performs unexpectedly, A Tech 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 A Tech will offset losses from the drop in A Tech's long position.| Hankook Steel vs. Narae Nanotech Corp | Hankook Steel vs. FNSTech Co | Hankook Steel vs. Nh Investment And | Hankook Steel vs. Coloray International Investment |
| A Tech vs. MediaZen | A Tech vs. Barunson Entertainment Arts | A Tech vs. Shinhan Inverse Silver | A Tech vs. Next Entertainment World |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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