Correlation Between Genie Music and Hansol Chemical
Can any of the company-specific risk be diversified away by investing in both Genie Music and Hansol Chemical 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 Genie Music and Hansol Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genie Music and Hansol Chemical Co, you can compare the effects of market volatilities on Genie Music and Hansol Chemical 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 Genie Music with a short position of Hansol Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genie Music and Hansol Chemical.
Diversification Opportunities for Genie Music and Hansol Chemical
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Genie and Hansol is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Genie Music and Hansol Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hansol Chemical and Genie Music 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 Genie Music are associated (or correlated) with Hansol Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hansol Chemical has no effect on the direction of Genie Music i.e., Genie Music and Hansol Chemical go up and down completely randomly.
Pair Corralation between Genie Music and Hansol Chemical
Assuming the 90 days trading horizon Genie Music is expected to generate 1.06 times more return on investment than Hansol Chemical. However, Genie Music is 1.06 times more volatile than Hansol Chemical Co. It trades about -0.06 of its potential returns per unit of risk. Hansol Chemical Co is currently generating about -0.08 per unit of risk. If you would invest 332,000 in Genie Music on August 27, 2024 and sell it today you would lose (113,000) from holding Genie Music or give up 34.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genie Music vs. Hansol Chemical Co
Performance |
| Timeline |
| Genie Music |
| Hansol Chemical |
Genie Music and Hansol Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genie Music and Hansol Chemical
The main advantage of trading using opposite Genie Music and Hansol Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genie Music position performs unexpectedly, Hansol Chemical 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 Hansol Chemical will offset losses from the drop in Hansol Chemical's long position.| Genie Music vs. AfreecaTV Co | Genie Music vs. SS TECH | Genie Music vs. Busan Industrial Co | Genie Music vs. Busan Ind |
| Hansol Chemical vs. AptaBio Therapeutics | Hansol Chemical vs. Daewoo SBI SPAC | Hansol Chemical vs. Dream Security co | Hansol Chemical 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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