Correlation Between HB Technology and Incar Financial
Can any of the company-specific risk be diversified away by investing in both HB Technology and Incar Financial 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 Incar Financial 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 Incar Financial Service, you can compare the effects of market volatilities on HB Technology and Incar Financial 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 Incar Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of HB Technology and Incar Financial.
Diversification Opportunities for HB Technology and Incar Financial
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 078150 and Incar is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding HB Technology TD and Incar Financial Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Incar Financial Service 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 Incar Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Incar Financial Service has no effect on the direction of HB Technology i.e., HB Technology and Incar Financial go up and down completely randomly.
Pair Corralation between HB Technology and Incar Financial
Assuming the 90 days trading horizon HB Technology TD is expected to generate 1.61 times more return on investment than Incar Financial. However, HB Technology is 1.61 times more volatile than Incar Financial Service. It trades about 0.19 of its potential returns per unit of risk. Incar Financial Service is currently generating about -0.06 per unit of risk. If you would invest 189,500 in HB Technology TD on October 30, 2024 and sell it today you would earn a total of 59,000 from holding HB Technology TD or generate 31.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HB Technology TD vs. Incar Financial Service
Performance |
| Timeline |
| HB Technology TD |
| Incar Financial Service |
HB Technology and Incar Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HB Technology and Incar Financial
The main advantage of trading using opposite HB Technology and Incar Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HB Technology position performs unexpectedly, Incar Financial 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 Incar Financial will offset losses from the drop in Incar Financial's long position.| HB Technology vs. Finebesteel | HB Technology vs. CJ Seafood Corp | HB Technology vs. Samyang Foods Co | HB Technology vs. Seah Steel Corp |
| Incar Financial vs. Daechang Steel Co | Incar Financial vs. Iljin Display | Incar Financial vs. Finebesteel | Incar Financial vs. Digital Power Communications |
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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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