Correlation Between HB Technology and Seoul Food
Can any of the company-specific risk be diversified away by investing in both HB Technology and Seoul Food 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 HB Technology and Seoul Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HB Technology TD and Seoul Food Industrial, you can compare the effects of market volatilities on HB Technology and Seoul Food 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 HB Technology with a short position of Seoul Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of HB Technology and Seoul Food.
Diversification Opportunities for HB Technology and Seoul Food
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 078150 and Seoul is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding HB Technology TD and Seoul Food Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seoul Food Industrial and HB Technology 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 HB Technology TD are associated (or correlated) with Seoul Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seoul Food Industrial has no effect on the direction of HB Technology i.e., HB Technology and Seoul Food go up and down completely randomly.
Pair Corralation between HB Technology and Seoul Food
Assuming the 90 days trading horizon HB Technology TD is expected to generate 3.01 times more return on investment than Seoul Food. However, HB Technology is 3.01 times more volatile than Seoul Food Industrial. It trades about 0.03 of its potential returns per unit of risk. Seoul Food Industrial is currently generating about -0.05 per unit of risk. If you would invest 186,414 in HB Technology TD on October 28, 2024 and sell it today you would earn a total of 62,086 from holding HB Technology TD or generate 33.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HB Technology TD vs. Seoul Food Industrial
Performance |
| Timeline |
| HB Technology TD |
| Seoul Food Industrial |
HB Technology and Seoul Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HB Technology and Seoul Food
The main advantage of trading using opposite HB Technology and Seoul Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HB Technology position performs unexpectedly, Seoul Food 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 Seoul Food will offset losses from the drop in Seoul Food's long position.| HB Technology vs. Adaptive Plasma Technology | HB Technology vs. NewFlex Technology Co | HB Technology vs. Ilji Technology Co | HB Technology vs. Eugene Technology CoLtd |
| Seoul Food vs. KB Financial Group | Seoul Food vs. Shinhan Financial Group | Seoul Food vs. Hana Financial | Seoul Food vs. Woori Financial Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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