Correlation Between Haesung Industrial and CJ CheilJedang
Can any of the company-specific risk be diversified away by investing in both Haesung Industrial and CJ CheilJedang 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 CJ CheilJedang 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 CJ CheilJedang Corp, you can compare the effects of market volatilities on Haesung Industrial and CJ CheilJedang 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 CJ CheilJedang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haesung Industrial and CJ CheilJedang.
Diversification Opportunities for Haesung Industrial and CJ CheilJedang
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Haesung and 097955 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Haesung Industrial Co and CJ CheilJedang Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CJ CheilJedang Corp 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 CJ CheilJedang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CJ CheilJedang Corp has no effect on the direction of Haesung Industrial i.e., Haesung Industrial and CJ CheilJedang go up and down completely randomly.
Pair Corralation between Haesung Industrial and CJ CheilJedang
Assuming the 90 days trading horizon Haesung Industrial Co is expected to under-perform the CJ CheilJedang. In addition to that, Haesung Industrial is 1.22 times more volatile than CJ CheilJedang Corp. It trades about -0.07 of its total potential returns per unit of risk. CJ CheilJedang Corp is currently generating about -0.01 per unit of volatility. If you would invest 14,204,300 in CJ CheilJedang Corp on August 31, 2024 and sell it today you would lose (944,300) from holding CJ CheilJedang Corp or give up 6.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haesung Industrial Co vs. CJ CheilJedang Corp
Performance |
| Timeline |
| Haesung Industrial |
| CJ CheilJedang Corp |
Haesung Industrial and CJ CheilJedang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haesung Industrial and CJ CheilJedang
The main advantage of trading using opposite Haesung Industrial and CJ CheilJedang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haesung Industrial position performs unexpectedly, CJ CheilJedang 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 CJ CheilJedang will offset losses from the drop in CJ CheilJedang's long position.| Haesung Industrial vs. Busan Industrial Co | Haesung Industrial vs. Busan Ind | Haesung Industrial vs. Mirae Asset Daewoo | Haesung Industrial vs. Finebesteel |
| CJ CheilJedang vs. TS Investment Corp | CJ CheilJedang vs. Hanjoo Light Metal | CJ CheilJedang vs. Samyang Foods Co | CJ CheilJedang vs. DB Financial Investment |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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