Correlation Between Nice Information and Haesung Industrial
Can any of the company-specific risk be diversified away by investing in both Nice Information and Haesung Industrial 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 Nice Information and Haesung Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nice Information Telecommunication and Haesung Industrial Co, you can compare the effects of market volatilities on Nice Information and Haesung Industrial 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 Nice Information with a short position of Haesung Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nice Information and Haesung Industrial.
Diversification Opportunities for Nice Information and Haesung Industrial
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nice and Haesung is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Nice Information Telecommunica and Haesung Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haesung Industrial and Nice Information 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 Nice Information Telecommunication are associated (or correlated) with Haesung Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haesung Industrial has no effect on the direction of Nice Information i.e., Nice Information and Haesung Industrial go up and down completely randomly.
Pair Corralation between Nice Information and Haesung Industrial
Assuming the 90 days trading horizon Nice Information Telecommunication is expected to generate 0.3 times more return on investment than Haesung Industrial. However, Nice Information Telecommunication is 3.3 times less risky than Haesung Industrial. It trades about -0.3 of its potential returns per unit of risk. Haesung Industrial Co is currently generating about -0.35 per unit of risk. If you would invest 1,899,000 in Nice Information Telecommunication on September 3, 2024 and sell it today you would lose (58,000) from holding Nice Information Telecommunication or give up 3.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nice Information Telecommunica vs. Haesung Industrial Co
Performance |
| Timeline |
| Nice Information Tel |
| Haesung Industrial |
Nice Information and Haesung Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nice Information and Haesung Industrial
The main advantage of trading using opposite Nice Information and Haesung Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nice Information position performs unexpectedly, Haesung Industrial 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 Haesung Industrial will offset losses from the drop in Haesung Industrial's long position.| Nice Information vs. Soulbrain Holdings Co | Nice Information vs. NICE Total Cash | Nice Information vs. Geumhwa Plant Service | Nice Information vs. AfreecaTV Co |
| Haesung Industrial vs. Busan Industrial Co | Haesung Industrial vs. UNISEM Co | Haesung Industrial vs. RPBio Inc | Haesung Industrial vs. Finebesteel |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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