Correlation Between Shinhan Financial and Hanilcmt
Can any of the company-specific risk be diversified away by investing in both Shinhan Financial and Hanilcmt 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 Shinhan Financial and Hanilcmt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Financial Group and Hanilcmt Co, you can compare the effects of market volatilities on Shinhan Financial and Hanilcmt 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 Shinhan Financial with a short position of Hanilcmt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Financial and Hanilcmt.
Diversification Opportunities for Shinhan Financial and Hanilcmt
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shinhan and Hanilcmt is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Financial Group and Hanilcmt Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanilcmt and Shinhan Financial 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 Shinhan Financial Group are associated (or correlated) with Hanilcmt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanilcmt has no effect on the direction of Shinhan Financial i.e., Shinhan Financial and Hanilcmt go up and down completely randomly.
Pair Corralation between Shinhan Financial and Hanilcmt
Assuming the 90 days trading horizon Shinhan Financial Group is expected to under-perform the Hanilcmt. In addition to that, Shinhan Financial is 1.23 times more volatile than Hanilcmt Co. It trades about -0.16 of its total potential returns per unit of risk. Hanilcmt Co is currently generating about 0.1 per unit of volatility. If you would invest 1,368,000 in Hanilcmt Co on September 12, 2024 and sell it today you would earn a total of 67,000 from holding Hanilcmt Co or generate 4.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Financial Group vs. Hanilcmt Co
Performance |
| Timeline |
| Shinhan Financial |
| Hanilcmt |
Shinhan Financial and Hanilcmt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Financial and Hanilcmt
The main advantage of trading using opposite Shinhan Financial and Hanilcmt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Financial position performs unexpectedly, Hanilcmt 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 Hanilcmt will offset losses from the drop in Hanilcmt's long position.| Shinhan Financial vs. Samsung Electronics Co | Shinhan Financial vs. Samsung Electronics Co | Shinhan Financial vs. SK Hynix | Shinhan Financial vs. POSCO Holdings |
| Hanilcmt vs. Solution Advanced Technology | Hanilcmt vs. Korea Shipbuilding Offshore | Hanilcmt vs. Shinhan Financial Group | Hanilcmt vs. Settlebank |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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