Correlation Between Sungdo Engineering and Hanwha Life
Can any of the company-specific risk be diversified away by investing in both Sungdo Engineering and Hanwha Life 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 Sungdo Engineering and Hanwha Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sungdo Engineering Construction and Hanwha Life Insurance, you can compare the effects of market volatilities on Sungdo Engineering and Hanwha Life 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 Sungdo Engineering with a short position of Hanwha Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sungdo Engineering and Hanwha Life.
Diversification Opportunities for Sungdo Engineering and Hanwha Life
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sungdo and Hanwha is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sungdo Engineering Constructio and Hanwha Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanwha Life Insurance and Sungdo Engineering 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 Sungdo Engineering Construction are associated (or correlated) with Hanwha Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanwha Life Insurance has no effect on the direction of Sungdo Engineering i.e., Sungdo Engineering and Hanwha Life go up and down completely randomly.
Pair Corralation between Sungdo Engineering and Hanwha Life
Assuming the 90 days trading horizon Sungdo Engineering is expected to generate 2.14 times less return on investment than Hanwha Life. In addition to that, Sungdo Engineering is 1.06 times more volatile than Hanwha Life Insurance. It trades about 0.01 of its total potential returns per unit of risk. Hanwha Life Insurance is currently generating about 0.01 per unit of volatility. If you would invest 244,214 in Hanwha Life Insurance on October 27, 2024 and sell it today you would earn a total of 2,786 from holding Hanwha Life Insurance or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sungdo Engineering Constructio vs. Hanwha Life Insurance
Performance |
| Timeline |
| Sungdo Engineering |
| Hanwha Life Insurance |
Sungdo Engineering and Hanwha Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sungdo Engineering and Hanwha Life
The main advantage of trading using opposite Sungdo Engineering and Hanwha Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sungdo Engineering position performs unexpectedly, Hanwha Life 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 Hanwha Life will offset losses from the drop in Hanwha Life's long position.| Sungdo Engineering vs. Lotte Chilsung Beverage | Sungdo Engineering vs. Mirai Semiconductors Co | Sungdo Engineering vs. ABOV Semiconductor Co | Sungdo Engineering vs. SK Telecom Co |
| Hanwha Life vs. Daejoo Electronic Materials | Hanwha Life vs. Solus Advanced Materials | Hanwha Life vs. Incar Financial Service | Hanwha Life vs. RF Materials Co |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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