Correlation Between Korea Information and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Korea Information and Haitai Confectionery 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 Korea Information and Haitai Confectionery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Information Engineering and Haitai Confectionery Foods, you can compare the effects of market volatilities on Korea Information and Haitai Confectionery 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 Korea Information with a short position of Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Information and Haitai Confectionery.
Diversification Opportunities for Korea Information and Haitai Confectionery
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Korea and Haitai is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Korea Information Engineering and Haitai Confectionery Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haitai Confectionery and Korea 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 Korea Information Engineering are associated (or correlated) with Haitai Confectionery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haitai Confectionery has no effect on the direction of Korea Information i.e., Korea Information and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Korea Information and Haitai Confectionery
Assuming the 90 days trading horizon Korea Information Engineering is expected to generate 1.97 times more return on investment than Haitai Confectionery. However, Korea Information is 1.97 times more volatile than Haitai Confectionery Foods. It trades about 0.19 of its potential returns per unit of risk. Haitai Confectionery Foods is currently generating about -0.11 per unit of risk. If you would invest 239,000 in Korea Information Engineering on October 28, 2024 and sell it today you would earn a total of 19,000 from holding Korea Information Engineering or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Information Engineering vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Korea Information |
| Haitai Confectionery |
Korea Information and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Information and Haitai Confectionery
The main advantage of trading using opposite Korea Information and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Information position performs unexpectedly, Haitai Confectionery 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 Haitai Confectionery will offset losses from the drop in Haitai Confectionery's long position.| Korea Information vs. INFINITT Healthcare Co | Korea Information vs. PJ Metal Co | Korea Information vs. Infinitt Healthcare Co | Korea Information vs. Echomarketing CoLtd |
| Haitai Confectionery vs. KT Submarine Telecom | Haitai Confectionery vs. Nable Communications | Haitai Confectionery vs. SK Telecom Co | Haitai Confectionery vs. Dongil Metal 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |