Correlation Between GeneBioTech and Haesung Industrial
Can any of the company-specific risk be diversified away by investing in both GeneBioTech and Haesung Industrial 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 GeneBioTech and Haesung Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GeneBioTech Co and Haesung Industrial Co, you can compare the effects of market volatilities on GeneBioTech and Haesung Industrial 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 GeneBioTech with a short position of Haesung Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of GeneBioTech and Haesung Industrial.
Diversification Opportunities for GeneBioTech and Haesung Industrial
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GeneBioTech and Haesung is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding GeneBioTech Co and Haesung Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haesung Industrial and GeneBioTech 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 GeneBioTech Co are associated (or correlated) with Haesung Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haesung Industrial has no effect on the direction of GeneBioTech i.e., GeneBioTech and Haesung Industrial go up and down completely randomly.
Pair Corralation between GeneBioTech and Haesung Industrial
Assuming the 90 days trading horizon GeneBioTech Co is expected to generate 1.25 times more return on investment than Haesung Industrial. However, GeneBioTech is 1.25 times more volatile than Haesung Industrial Co. It trades about -0.01 of its potential returns per unit of risk. Haesung Industrial Co is currently generating about -0.06 per unit of risk. If you would invest 399,000 in GeneBioTech Co on September 19, 2024 and sell it today you would lose (58,000) from holding GeneBioTech Co or give up 14.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GeneBioTech Co vs. Haesung Industrial Co
Performance |
| Timeline |
| GeneBioTech |
| Haesung Industrial |
GeneBioTech and Haesung Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GeneBioTech and Haesung Industrial
The main advantage of trading using opposite GeneBioTech and Haesung Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GeneBioTech position performs unexpectedly, Haesung Industrial 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 Haesung Industrial will offset losses from the drop in Haesung Industrial's long position.| GeneBioTech vs. Haesung Industrial Co | GeneBioTech vs. CU Medical Systems | GeneBioTech vs. Myoung Shin Industrial | GeneBioTech vs. Hansol Homedeco Co |
| Haesung Industrial vs. Solution Advanced Technology | Haesung Industrial vs. Busan Industrial Co | Haesung Industrial vs. Busan Ind | Haesung Industrial vs. Sam Chun Dang |
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..
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