Correlation Between Yura Tech and Hana Materials
Can any of the company-specific risk be diversified away by investing in both Yura Tech and Hana Materials 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 Yura Tech and Hana Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yura Tech Co and Hana Materials, you can compare the effects of market volatilities on Yura Tech and Hana Materials 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 Yura Tech with a short position of Hana Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yura Tech and Hana Materials.
Diversification Opportunities for Yura Tech and Hana Materials
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Yura and Hana is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Yura Tech Co and Hana Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Materials and Yura Tech 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 Yura Tech Co are associated (or correlated) with Hana Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Materials has no effect on the direction of Yura Tech i.e., Yura Tech and Hana Materials go up and down completely randomly.
Pair Corralation between Yura Tech and Hana Materials
Assuming the 90 days trading horizon Yura Tech is expected to generate 2.08 times less return on investment than Hana Materials. But when comparing it to its historical volatility, Yura Tech Co is 1.85 times less risky than Hana Materials. It trades about 0.24 of its potential returns per unit of risk. Hana Materials is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,305,000 in Hana Materials on October 21, 2024 and sell it today you would earn a total of 430,000 from holding Hana Materials or generate 18.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yura Tech Co vs. Hana Materials
Performance |
| Timeline |
| Yura Tech |
| Hana Materials |
Yura Tech and Hana Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yura Tech and Hana Materials
The main advantage of trading using opposite Yura Tech and Hana Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yura Tech position performs unexpectedly, Hana Materials 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 Hana Materials will offset losses from the drop in Hana Materials' long position.| Yura Tech vs. Woori Technology Investment | Yura Tech vs. E Investment Development | Yura Tech vs. EBEST Investment Securities | Yura Tech vs. Samyung Trading Co |
| Hana Materials vs. SK Hynix | Hana Materials vs. LX Semicon Co | Hana Materials vs. Tokai Carbon Korea | Hana Materials vs. People 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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