Correlation Between Hanwha Life and Insun Environment
Can any of the company-specific risk be diversified away by investing in both Hanwha Life and Insun Environment 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 Hanwha Life and Insun Environment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanwha Life Insurance and Insun Environment New, you can compare the effects of market volatilities on Hanwha Life and Insun Environment 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 Hanwha Life with a short position of Insun Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha Life and Insun Environment.
Diversification Opportunities for Hanwha Life and Insun Environment
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hanwha and Insun is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha Life Insurance and Insun Environment New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Insun Environment New and Hanwha Life 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 Hanwha Life Insurance are associated (or correlated) with Insun Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Insun Environment New has no effect on the direction of Hanwha Life i.e., Hanwha Life and Insun Environment go up and down completely randomly.
Pair Corralation between Hanwha Life and Insun Environment
Assuming the 90 days trading horizon Hanwha Life Insurance is expected to generate 1.4 times more return on investment than Insun Environment. However, Hanwha Life is 1.4 times more volatile than Insun Environment New. It trades about 0.0 of its potential returns per unit of risk. Insun Environment New is currently generating about -0.04 per unit of risk. If you would invest 274,147 in Hanwha Life Insurance on October 13, 2024 and sell it today you would lose (24,147) from holding Hanwha Life Insurance or give up 8.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.83% |
| Values | Daily Returns |
Hanwha Life Insurance vs. Insun Environment New
Performance |
| Timeline |
| Hanwha Life Insurance |
| Insun Environment New |
Hanwha Life and Insun Environment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha Life and Insun Environment
The main advantage of trading using opposite Hanwha Life and Insun Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha Life position performs unexpectedly, Insun Environment 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 Insun Environment will offset losses from the drop in Insun Environment's long position.| Hanwha Life vs. AptaBio Therapeutics | Hanwha Life vs. Daewoo SBI SPAC | Hanwha Life vs. Dream Security co | Hanwha Life vs. Microfriend |
| Insun Environment vs. Jin Air Co | Insun Environment vs. Hanwha Life Insurance | Insun Environment vs. Haitai Confectionery Foods | Insun Environment vs. Hanjin Transportation 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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