Correlation Between Jeong Moon and Hanjin Transportation
Can any of the company-specific risk be diversified away by investing in both Jeong Moon and Hanjin Transportation 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 Jeong Moon and Hanjin Transportation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeong Moon Information and Hanjin Transportation Co, you can compare the effects of market volatilities on Jeong Moon and Hanjin Transportation 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 Jeong Moon with a short position of Hanjin Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeong Moon and Hanjin Transportation.
Diversification Opportunities for Jeong Moon and Hanjin Transportation
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jeong and Hanjin is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Jeong Moon Information and Hanjin Transportation Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanjin Transportation and Jeong Moon 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 Jeong Moon Information are associated (or correlated) with Hanjin Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanjin Transportation has no effect on the direction of Jeong Moon i.e., Jeong Moon and Hanjin Transportation go up and down completely randomly.
Pair Corralation between Jeong Moon and Hanjin Transportation
Assuming the 90 days trading horizon Jeong Moon Information is expected to under-perform the Hanjin Transportation. In addition to that, Jeong Moon is 1.15 times more volatile than Hanjin Transportation Co. It trades about -0.03 of its total potential returns per unit of risk. Hanjin Transportation Co is currently generating about 0.0 per unit of volatility. If you would invest 2,084,850 in Hanjin Transportation Co on October 27, 2024 and sell it today you would lose (144,850) from holding Hanjin Transportation Co or give up 6.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeong Moon Information vs. Hanjin Transportation Co
Performance |
| Timeline |
| Jeong Moon Information |
| Hanjin Transportation |
Jeong Moon and Hanjin Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeong Moon and Hanjin Transportation
The main advantage of trading using opposite Jeong Moon and Hanjin Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeong Moon position performs unexpectedly, Hanjin Transportation 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 Hanjin Transportation will offset losses from the drop in Hanjin Transportation's long position.| Jeong Moon vs. Samsung Electronics Co | Jeong Moon vs. Samsung Electronics Co | Jeong Moon vs. SK Hynix | Jeong Moon vs. HMM Co |
| Hanjin Transportation vs. KB Financial Group | Hanjin Transportation vs. Shinhan Financial Group | Hanjin Transportation vs. Hana Financial | Hanjin Transportation vs. Woori Financial Group |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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