Correlation Between Ewon Comfortech and Hankook Furniture
Can any of the company-specific risk be diversified away by investing in both Ewon Comfortech and Hankook Furniture 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 Ewon Comfortech and Hankook Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ewon Comfortech Co and Hankook Furniture Co, you can compare the effects of market volatilities on Ewon Comfortech and Hankook Furniture 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 Ewon Comfortech with a short position of Hankook Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ewon Comfortech and Hankook Furniture.
Diversification Opportunities for Ewon Comfortech and Hankook Furniture
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ewon and Hankook is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Ewon Comfortech Co and Hankook Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hankook Furniture and Ewon Comfortech 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 Ewon Comfortech Co are associated (or correlated) with Hankook Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hankook Furniture has no effect on the direction of Ewon Comfortech i.e., Ewon Comfortech and Hankook Furniture go up and down completely randomly.
Pair Corralation between Ewon Comfortech and Hankook Furniture
Assuming the 90 days trading horizon Ewon Comfortech Co is expected to under-perform the Hankook Furniture. In addition to that, Ewon Comfortech is 3.52 times more volatile than Hankook Furniture Co. It trades about -0.07 of its total potential returns per unit of risk. Hankook Furniture Co is currently generating about 0.01 per unit of volatility. If you would invest 394,978 in Hankook Furniture Co on November 27, 2024 and sell it today you would earn a total of 17,522 from holding Hankook Furniture Co or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ewon Comfortech Co vs. Hankook Furniture Co
Performance |
| Timeline |
| Ewon Comfortech |
| Hankook Furniture |
Ewon Comfortech and Hankook Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ewon Comfortech and Hankook Furniture
The main advantage of trading using opposite Ewon Comfortech and Hankook Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ewon Comfortech position performs unexpectedly, Hankook Furniture 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 Hankook Furniture will offset losses from the drop in Hankook Furniture's long position.| Ewon Comfortech vs. Neungyule Education | Ewon Comfortech vs. Keyang Electric Machinery | Ewon Comfortech vs. Dongwoo Farm To | Ewon Comfortech vs. Camus Engineering Construction |
| Hankook Furniture vs. Husteel | Hankook Furniture vs. Insun Environment New | Hankook Furniture vs. Nable Communications | Hankook Furniture vs. Hironic Co |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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