Correlation Between Hanmi Semiconductor and DHP Korea
Can any of the company-specific risk be diversified away by investing in both Hanmi Semiconductor and DHP Korea 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 DHP Korea 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 DHP Korea Co, you can compare the effects of market volatilities on Hanmi Semiconductor and DHP Korea 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 DHP Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanmi Semiconductor and DHP Korea.
Diversification Opportunities for Hanmi Semiconductor and DHP Korea
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hanmi and DHP is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Hanmi Semiconductor Co and DHP Korea Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DHP Korea 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 DHP Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DHP Korea has no effect on the direction of Hanmi Semiconductor i.e., Hanmi Semiconductor and DHP Korea go up and down completely randomly.
Pair Corralation between Hanmi Semiconductor and DHP Korea
Assuming the 90 days trading horizon Hanmi Semiconductor Co is expected to under-perform the DHP Korea. But the stock apears to be less risky and, when comparing its historical volatility, Hanmi Semiconductor Co is 1.3 times less risky than DHP Korea. The stock trades about -0.4 of its potential returns per unit of risk. The DHP Korea Co is currently generating about -0.17 of returns per unit of risk over similar time horizon. If you would invest 608,000 in DHP Korea Co on September 12, 2024 and sell it today you would lose (74,000) from holding DHP Korea Co or give up 12.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hanmi Semiconductor Co vs. DHP Korea Co
Performance |
| Timeline |
| Hanmi Semiconductor |
| DHP Korea |
Hanmi Semiconductor and DHP Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanmi Semiconductor and DHP Korea
The main advantage of trading using opposite Hanmi Semiconductor and DHP Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanmi Semiconductor position performs unexpectedly, DHP Korea 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 DHP Korea will offset losses from the drop in DHP Korea's long position.| Hanmi Semiconductor vs. Dongbang Transport Logistics | Hanmi Semiconductor vs. Shinhan Financial Group | Hanmi Semiconductor vs. Alton Sports CoLtd | Hanmi Semiconductor vs. Lotte Non Life Insurance |
| DHP Korea vs. LG Household Healthcare | DHP Korea vs. Intellian Technologies | DHP Korea vs. Hanmi Semiconductor Co | DHP Korea vs. Woori Technology |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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