Correlation Between Haesung Industrial and Shinsegae Food
Can any of the company-specific risk be diversified away by investing in both Haesung Industrial and Shinsegae 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 Haesung Industrial and Shinsegae Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haesung Industrial Co and Shinsegae Food, you can compare the effects of market volatilities on Haesung Industrial and Shinsegae 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 Haesung Industrial with a short position of Shinsegae Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haesung Industrial and Shinsegae Food.
Diversification Opportunities for Haesung Industrial and Shinsegae Food
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Haesung and Shinsegae is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Haesung Industrial Co and Shinsegae Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shinsegae Food and Haesung Industrial 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 Haesung Industrial Co are associated (or correlated) with Shinsegae Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shinsegae Food has no effect on the direction of Haesung Industrial i.e., Haesung Industrial and Shinsegae Food go up and down completely randomly.
Pair Corralation between Haesung Industrial and Shinsegae Food
Assuming the 90 days trading horizon Haesung Industrial Co is expected to generate 1.33 times more return on investment than Shinsegae Food. However, Haesung Industrial is 1.33 times more volatile than Shinsegae Food. It trades about -0.08 of its potential returns per unit of risk. Shinsegae Food is currently generating about -0.13 per unit of risk. If you would invest 641,000 in Haesung Industrial Co on September 12, 2024 and sell it today you would lose (67,000) from holding Haesung Industrial Co or give up 10.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haesung Industrial Co vs. Shinsegae Food
Performance |
| Timeline |
| Haesung Industrial |
| Shinsegae Food |
Haesung Industrial and Shinsegae Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haesung Industrial and Shinsegae Food
The main advantage of trading using opposite Haesung Industrial and Shinsegae Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haesung Industrial position performs unexpectedly, Shinsegae 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 Shinsegae Food will offset losses from the drop in Shinsegae Food's long position.| Haesung Industrial vs. Solution Advanced Technology | Haesung Industrial vs. Busan Industrial Co | Haesung Industrial vs. Busan Ind | Haesung Industrial vs. Sam Chun Dang |
| Shinsegae Food vs. Haesung Industrial Co | Shinsegae Food vs. Eagon Industrial Co | Shinsegae Food vs. A Tech Solution Co | Shinsegae Food vs. Intellian Technologies |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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