Correlation Between Wonbang Tech and Hanil Iron
Can any of the company-specific risk be diversified away by investing in both Wonbang Tech and Hanil Iron 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 Wonbang Tech and Hanil Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wonbang Tech Co and Hanil Iron Steel, you can compare the effects of market volatilities on Wonbang Tech and Hanil Iron 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 Wonbang Tech with a short position of Hanil Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wonbang Tech and Hanil Iron.
Diversification Opportunities for Wonbang Tech and Hanil Iron
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wonbang and Hanil is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Wonbang Tech Co and Hanil Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanil Iron Steel and Wonbang 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 Wonbang Tech Co are associated (or correlated) with Hanil Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanil Iron Steel has no effect on the direction of Wonbang Tech i.e., Wonbang Tech and Hanil Iron go up and down completely randomly.
Pair Corralation between Wonbang Tech and Hanil Iron
Assuming the 90 days trading horizon Wonbang Tech Co is expected to under-perform the Hanil Iron. In addition to that, Wonbang Tech is 1.77 times more volatile than Hanil Iron Steel. It trades about -0.1 of its total potential returns per unit of risk. Hanil Iron Steel is currently generating about -0.14 per unit of volatility. If you would invest 204,000 in Hanil Iron Steel on September 26, 2024 and sell it today you would lose (12,500) from holding Hanil Iron Steel or give up 6.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wonbang Tech Co vs. Hanil Iron Steel
Performance |
| Timeline |
| Wonbang Tech |
| Hanil Iron Steel |
Wonbang Tech and Hanil Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wonbang Tech and Hanil Iron
The main advantage of trading using opposite Wonbang Tech and Hanil Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wonbang Tech position performs unexpectedly, Hanil Iron 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 Hanil Iron will offset losses from the drop in Hanil Iron's long position.| Wonbang Tech vs. Samsung Electronics Co | Wonbang Tech vs. Samsung Electronics Co | Wonbang Tech vs. LG Energy Solution | Wonbang Tech vs. SK Hynix |
| Hanil Iron vs. KIWI Media Group | Hanil Iron vs. SM Entertainment Co | Hanil Iron vs. Osang Healthcare Co,Ltd | Hanil Iron vs. ChipsMedia |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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