Correlation Between Hanmi Semiconductor and Kukdong Oil
Can any of the company-specific risk be diversified away by investing in both Hanmi Semiconductor and Kukdong Oil 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 Hanmi Semiconductor and Kukdong Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanmi Semiconductor Co and Kukdong Oil Chemicals, you can compare the effects of market volatilities on Hanmi Semiconductor and Kukdong Oil 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 Hanmi Semiconductor with a short position of Kukdong Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanmi Semiconductor and Kukdong Oil.
Diversification Opportunities for Hanmi Semiconductor and Kukdong Oil
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hanmi and Kukdong is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Hanmi Semiconductor Co and Kukdong Oil Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukdong Oil Chemicals and Hanmi Semiconductor 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 Hanmi Semiconductor Co are associated (or correlated) with Kukdong Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukdong Oil Chemicals has no effect on the direction of Hanmi Semiconductor i.e., Hanmi Semiconductor and Kukdong Oil go up and down completely randomly.
Pair Corralation between Hanmi Semiconductor and Kukdong Oil
Assuming the 90 days trading horizon Hanmi Semiconductor Co is expected to generate 1.45 times more return on investment than Kukdong Oil. However, Hanmi Semiconductor is 1.45 times more volatile than Kukdong Oil Chemicals. It trades about 0.1 of its potential returns per unit of risk. Kukdong Oil Chemicals is currently generating about 0.02 per unit of risk. If you would invest 2,140,475 in Hanmi Semiconductor Co on August 29, 2024 and sell it today you would earn a total of 5,929,525 from holding Hanmi Semiconductor Co or generate 277.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanmi Semiconductor Co vs. Kukdong Oil Chemicals
Performance |
| Timeline |
| Hanmi Semiconductor |
| Kukdong Oil Chemicals |
Hanmi Semiconductor and Kukdong Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanmi Semiconductor and Kukdong Oil
The main advantage of trading using opposite Hanmi Semiconductor and Kukdong Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanmi Semiconductor position performs unexpectedly, Kukdong Oil 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 Kukdong Oil will offset losses from the drop in Kukdong Oil's long position.| Hanmi Semiconductor vs. AptaBio Therapeutics | Hanmi Semiconductor vs. Daewoo SBI SPAC | Hanmi Semiconductor vs. Dream Security co | Hanmi Semiconductor vs. Microfriend |
| Kukdong Oil vs. AptaBio Therapeutics | Kukdong Oil vs. Daewoo SBI SPAC | Kukdong Oil vs. Dream Security co | Kukdong Oil 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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