Correlation Between Hana Financial and RedcapTour
Can any of the company-specific risk be diversified away by investing in both Hana Financial and RedcapTour 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 RedcapTour into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Financial and RedcapTour Co, you can compare the effects of market volatilities on Hana Financial and RedcapTour 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 RedcapTour. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Financial and RedcapTour.
Diversification Opportunities for Hana Financial and RedcapTour
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hana and RedcapTour is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hana Financial and RedcapTour Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RedcapTour 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 RedcapTour. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RedcapTour has no effect on the direction of Hana Financial i.e., Hana Financial and RedcapTour go up and down completely randomly.
Pair Corralation between Hana Financial and RedcapTour
Assuming the 90 days trading horizon Hana Financial is expected to generate 0.71 times more return on investment than RedcapTour. However, Hana Financial is 1.41 times less risky than RedcapTour. It trades about -0.1 of its potential returns per unit of risk. RedcapTour Co is currently generating about -0.07 per unit of risk. If you would invest 5,900,000 in Hana Financial on October 24, 2024 and sell it today you would lose (100,000) from holding Hana Financial or give up 1.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Financial vs. RedcapTour Co
Performance |
| Timeline |
| Hana Financial |
| RedcapTour |
Hana Financial and RedcapTour Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Financial and RedcapTour
The main advantage of trading using opposite Hana Financial and RedcapTour positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Financial position performs unexpectedly, RedcapTour 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 RedcapTour will offset losses from the drop in RedcapTour's long position.| Hana Financial vs. InfoBank | Hana Financial vs. Dgb Financial | Hana Financial vs. Samsung Life Insurance | Hana Financial vs. Alton Sports CoLtd |
| RedcapTour vs. Hanwha Chemical Corp | RedcapTour vs. Kukdong Oil Chemicals | RedcapTour vs. Daou Data Corp | RedcapTour vs. DataSolution |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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