Correlation Between Haesung Industrial and Hanmi Semiconductor
Can any of the company-specific risk be diversified away by investing in both Haesung Industrial and Hanmi Semiconductor 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 Hanmi Semiconductor 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 Hanmi Semiconductor Co, you can compare the effects of market volatilities on Haesung Industrial and Hanmi Semiconductor 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 Hanmi Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haesung Industrial and Hanmi Semiconductor.
Diversification Opportunities for Haesung Industrial and Hanmi Semiconductor
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Haesung and Hanmi is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Haesung Industrial Co and Hanmi Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanmi Semiconductor 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 Hanmi Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanmi Semiconductor has no effect on the direction of Haesung Industrial i.e., Haesung Industrial and Hanmi Semiconductor go up and down completely randomly.
Pair Corralation between Haesung Industrial and Hanmi Semiconductor
Assuming the 90 days trading horizon Haesung Industrial Co is expected to under-perform the Hanmi Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Haesung Industrial Co is 2.98 times less risky than Hanmi Semiconductor. The stock trades about -0.06 of its potential returns per unit of risk. The Hanmi Semiconductor Co is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,243,731 in Hanmi Semiconductor Co on August 27, 2024 and sell it today you would earn a total of 7,096,269 from holding Hanmi Semiconductor Co or generate 570.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haesung Industrial Co vs. Hanmi Semiconductor Co
Performance |
| Timeline |
| Haesung Industrial |
| Hanmi Semiconductor |
Haesung Industrial and Hanmi Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haesung Industrial and Hanmi Semiconductor
The main advantage of trading using opposite Haesung Industrial and Hanmi Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haesung Industrial position performs unexpectedly, Hanmi Semiconductor 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 Hanmi Semiconductor will offset losses from the drop in Hanmi Semiconductor's long position.| Haesung Industrial vs. Busan Industrial Co | Haesung Industrial vs. Busan Ind | Haesung Industrial vs. Mirae Asset Daewoo | Haesung Industrial vs. UNISEM Co |
| Hanmi Semiconductor vs. AptaBio Therapeutics | Hanmi Semiconductor vs. Daewoo SBI SPAC | Hanmi Semiconductor vs. Dream Security co | Hanmi Semiconductor vs. Microfriend |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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