Correlation Between Hanwha Life and Mirai Semiconductors
Can any of the company-specific risk be diversified away by investing in both Hanwha Life and Mirai Semiconductors 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 Mirai Semiconductors 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 Mirai Semiconductors Co, you can compare the effects of market volatilities on Hanwha Life and Mirai Semiconductors 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 Mirai Semiconductors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanwha Life and Mirai Semiconductors.
Diversification Opportunities for Hanwha Life and Mirai Semiconductors
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hanwha and Mirai is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Hanwha Life Insurance and Mirai Semiconductors Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirai Semiconductors 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 Mirai Semiconductors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirai Semiconductors has no effect on the direction of Hanwha Life i.e., Hanwha Life and Mirai Semiconductors go up and down completely randomly.
Pair Corralation between Hanwha Life and Mirai Semiconductors
Assuming the 90 days trading horizon Hanwha Life Insurance is expected to under-perform the Mirai Semiconductors. But the stock apears to be less risky and, when comparing its historical volatility, Hanwha Life Insurance is 1.67 times less risky than Mirai Semiconductors. The stock trades about -0.11 of its potential returns per unit of risk. The Mirai Semiconductors Co is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,136,000 in Mirai Semiconductors Co on October 15, 2024 and sell it today you would earn a total of 55,000 from holding Mirai Semiconductors Co or generate 4.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanwha Life Insurance vs. Mirai Semiconductors Co
Performance |
| Timeline |
| Hanwha Life Insurance |
| Mirai Semiconductors |
Hanwha Life and Mirai Semiconductors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanwha Life and Mirai Semiconductors
The main advantage of trading using opposite Hanwha Life and Mirai Semiconductors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanwha Life position performs unexpectedly, Mirai Semiconductors 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 Mirai Semiconductors will offset losses from the drop in Mirai Semiconductors' long position.| Hanwha Life vs. SK Chemicals Co | Hanwha Life vs. Techwing | Hanwha Life vs. Raontech | Hanwha Life vs. SEOWONINTECHCoLtd |
| Mirai Semiconductors vs. PlayD Co | Mirai Semiconductors vs. Hanwha Life Insurance | Mirai Semiconductors vs. PLAYWITH | Mirai Semiconductors vs. Iljin Display |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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