Correlation Between Home Center and Iljin Display
Can any of the company-specific risk be diversified away by investing in both Home Center and Iljin Display 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 Home Center and Iljin Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Center Holdings and Iljin Display, you can compare the effects of market volatilities on Home Center and Iljin Display 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 Home Center with a short position of Iljin Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Center and Iljin Display.
Diversification Opportunities for Home Center and Iljin Display
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Home and Iljin is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Home Center Holdings and Iljin Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Iljin Display and Home Center 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 Home Center Holdings are associated (or correlated) with Iljin Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Iljin Display has no effect on the direction of Home Center i.e., Home Center and Iljin Display go up and down completely randomly.
Pair Corralation between Home Center and Iljin Display
Assuming the 90 days trading horizon Home Center Holdings is expected to under-perform the Iljin Display. But the stock apears to be less risky and, when comparing its historical volatility, Home Center Holdings is 1.74 times less risky than Iljin Display. The stock trades about -0.09 of its potential returns per unit of risk. The Iljin Display is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 112,300 in Iljin Display on September 2, 2024 and sell it today you would lose (26,400) from holding Iljin Display or give up 23.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Home Center Holdings vs. Iljin Display
Performance |
| Timeline |
| Home Center Holdings |
| Iljin Display |
Home Center and Iljin Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Center and Iljin Display
The main advantage of trading using opposite Home Center and Iljin Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Center position performs unexpectedly, Iljin Display 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 Iljin Display will offset losses from the drop in Iljin Display's long position.| Home Center vs. LG Chemicals | Home Center vs. POSCO Holdings | Home Center vs. Hanwha Solutions | Home Center vs. Hyundai Steel |
| Iljin Display vs. Korea Investment Holdings | Iljin Display vs. Nh Investment And | Iljin Display vs. Golden Bridge Investment | Iljin Display vs. Woori Technology Investment |
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..
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |