Correlation Between HB Technology and Korea Real
Can any of the company-specific risk be diversified away by investing in both HB Technology and Korea Real 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 Korea Real 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 Korea Real Estate, you can compare the effects of market volatilities on HB Technology and Korea Real 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 Korea Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of HB Technology and Korea Real.
Diversification Opportunities for HB Technology and Korea Real
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 078150 and Korea is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding HB Technology TD and Korea Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Real Estate 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 Korea Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Real Estate has no effect on the direction of HB Technology i.e., HB Technology and Korea Real go up and down completely randomly.
Pair Corralation between HB Technology and Korea Real
Assuming the 90 days trading horizon HB Technology TD is expected to under-perform the Korea Real. In addition to that, HB Technology is 5.03 times more volatile than Korea Real Estate. It trades about -0.2 of its total potential returns per unit of risk. Korea Real Estate is currently generating about -0.02 per unit of volatility. If you would invest 104,100 in Korea Real Estate on August 31, 2024 and sell it today you would lose (400.00) from holding Korea Real Estate or give up 0.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HB Technology TD vs. Korea Real Estate
Performance |
| Timeline |
| HB Technology TD |
| Korea Real Estate |
HB Technology and Korea Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HB Technology and Korea Real
The main advantage of trading using opposite HB Technology and Korea Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HB Technology position performs unexpectedly, Korea Real 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 Korea Real will offset losses from the drop in Korea Real's long position.| HB Technology vs. Dongsin Engineering Construction | HB Technology vs. Doosan Fuel Cell | HB Technology vs. Daishin Balance 1 | HB Technology vs. Total Soft Bank |
| Korea Real vs. KT Submarine Telecom | Korea Real vs. Jb Financial | Korea Real vs. Samsung Life Insurance | Korea Real vs. SK Telecom Co |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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