Correlation Between Hanmi Semiconductor and Daesung Industrial
Can any of the company-specific risk be diversified away by investing in both Hanmi Semiconductor and Daesung 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 Hanmi Semiconductor and Daesung Industrial 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 Daesung Industrial Co, you can compare the effects of market volatilities on Hanmi Semiconductor and Daesung 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 Hanmi Semiconductor with a short position of Daesung Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanmi Semiconductor and Daesung Industrial.
Diversification Opportunities for Hanmi Semiconductor and Daesung Industrial
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hanmi and Daesung is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hanmi Semiconductor Co and Daesung Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daesung Industrial 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 Daesung Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daesung Industrial has no effect on the direction of Hanmi Semiconductor i.e., Hanmi Semiconductor and Daesung Industrial go up and down completely randomly.
Pair Corralation between Hanmi Semiconductor and Daesung Industrial
Assuming the 90 days trading horizon Hanmi Semiconductor Co is expected to under-perform the Daesung Industrial. In addition to that, Hanmi Semiconductor is 2.47 times more volatile than Daesung Industrial Co. It trades about -0.19 of its total potential returns per unit of risk. Daesung Industrial Co is currently generating about 0.27 per unit of volatility. If you would invest 322,500 in Daesung Industrial Co on November 25, 2024 and sell it today you would earn a total of 22,000 from holding Daesung Industrial Co or generate 6.82% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Hanmi Semiconductor Co vs. Daesung Industrial Co
Performance |
Timeline |
Hanmi Semiconductor |
Daesung Industrial |
Hanmi Semiconductor and Daesung Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hanmi Semiconductor and Daesung Industrial
The main advantage of trading using opposite Hanmi Semiconductor and Daesung Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanmi Semiconductor position performs unexpectedly, Daesung 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 Daesung Industrial will offset losses from the drop in Daesung Industrial's long position.Hanmi Semiconductor vs. Kaonmedia Co | ||
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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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