Correlation Between HB Technology and SK Chemicals
Can any of the company-specific risk be diversified away by investing in both HB Technology and SK Chemicals 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 SK Chemicals 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 SK Chemicals Co, you can compare the effects of market volatilities on HB Technology and SK Chemicals 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 SK Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of HB Technology and SK Chemicals.
Diversification Opportunities for HB Technology and SK Chemicals
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 078150 and 285130 is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding HB Technology TD and SK Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Chemicals 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 SK Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Chemicals has no effect on the direction of HB Technology i.e., HB Technology and SK Chemicals go up and down completely randomly.
Pair Corralation between HB Technology and SK Chemicals
Assuming the 90 days trading horizon HB Technology TD is expected to generate 1.57 times more return on investment than SK Chemicals. However, HB Technology is 1.57 times more volatile than SK Chemicals Co. It trades about 0.16 of its potential returns per unit of risk. SK Chemicals Co is currently generating about 0.05 per unit of risk. If you would invest 190,300 in HB Technology TD on October 16, 2024 and sell it today you would earn a total of 49,200 from holding HB Technology TD or generate 25.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HB Technology TD vs. SK Chemicals Co
Performance |
| Timeline |
| HB Technology TD |
| SK Chemicals |
HB Technology and SK Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HB Technology and SK Chemicals
The main advantage of trading using opposite HB Technology and SK Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HB Technology position performs unexpectedly, SK Chemicals 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 SK Chemicals will offset losses from the drop in SK Chemicals' long position.| HB Technology vs. Neungyule Education | HB Technology vs. Hana Materials | HB Technology vs. Settlebank | HB Technology vs. Dongbang Transport Logistics |
| SK Chemicals vs. HB Technology TD | SK Chemicals vs. Drb Industrial | SK Chemicals vs. LEENO Industrial | SK Chemicals vs. Hwangkum Steel Technology |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |