Correlation Between Hana Financial and PLAYWITH
Can any of the company-specific risk be diversified away by investing in both Hana Financial and PLAYWITH 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 Hana Financial and PLAYWITH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Financial and PLAYWITH, you can compare the effects of market volatilities on Hana Financial and PLAYWITH 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 Hana Financial with a short position of PLAYWITH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Financial and PLAYWITH.
Diversification Opportunities for Hana Financial and PLAYWITH
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hana and PLAYWITH is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Hana Financial and PLAYWITH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLAYWITH and Hana Financial 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 Hana Financial are associated (or correlated) with PLAYWITH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLAYWITH has no effect on the direction of Hana Financial i.e., Hana Financial and PLAYWITH go up and down completely randomly.
Pair Corralation between Hana Financial and PLAYWITH
Assuming the 90 days trading horizon Hana Financial is expected to generate 0.48 times more return on investment than PLAYWITH. However, Hana Financial is 2.07 times less risky than PLAYWITH. It trades about 0.3 of its potential returns per unit of risk. PLAYWITH is currently generating about -0.04 per unit of risk. If you would invest 5,680,000 in Hana Financial on October 29, 2024 and sell it today you would earn a total of 240,000 from holding Hana Financial or generate 4.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Financial vs. PLAYWITH
Performance |
| Timeline |
| Hana Financial |
| PLAYWITH |
Hana Financial and PLAYWITH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Financial and PLAYWITH
The main advantage of trading using opposite Hana Financial and PLAYWITH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Financial position performs unexpectedly, PLAYWITH 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 PLAYWITH will offset losses from the drop in PLAYWITH's long position.| Hana Financial vs. Jeju Beer Co | Hana Financial vs. Daiyang Metal Co | Hana Financial vs. Kukil Metal Co | Hana Financial vs. System and Application |
| PLAYWITH vs. Clean Science co | PLAYWITH vs. Korean Reinsurance Co | PLAYWITH vs. Settlebank | PLAYWITH vs. Shinhan 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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