Correlation Between Sang A and Hana Financial
Can any of the company-specific risk be diversified away by investing in both Sang A and Hana Financial 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 Sang A and Hana Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sang A Frontec CoLtd and Hana Financial 7, you can compare the effects of market volatilities on Sang A and Hana Financial 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 Sang A with a short position of Hana Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sang A and Hana Financial.
Diversification Opportunities for Sang A and Hana Financial
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sang and Hana is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Sang A Frontec CoLtd and Hana Financial 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Financial 7 and Sang A 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 Sang A Frontec CoLtd are associated (or correlated) with Hana Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Financial 7 has no effect on the direction of Sang A i.e., Sang A and Hana Financial go up and down completely randomly.
Pair Corralation between Sang A and Hana Financial
Assuming the 90 days trading horizon Sang A is expected to generate 7.67 times less return on investment than Hana Financial. But when comparing it to its historical volatility, Sang A Frontec CoLtd is 1.2 times less risky than Hana Financial. It trades about 0.0 of its potential returns per unit of risk. Hana Financial 7 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 1,699,000 in Hana Financial 7 on September 20, 2024 and sell it today you would lose (164,000) from holding Hana Financial 7 or give up 9.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Sang A Frontec CoLtd vs. Hana Financial 7
Performance |
| Timeline |
| Sang A Frontec |
| Hana Financial 7 |
Sang A and Hana Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sang A and Hana Financial
The main advantage of trading using opposite Sang A and Hana Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sang A position performs unexpectedly, Hana Financial 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 Hana Financial will offset losses from the drop in Hana Financial's long position.| Sang A vs. Digital Imaging Technology | Sang A vs. Polaris Office Corp | Sang A vs. Eagle Veterinary Technology | Sang A vs. Eugene Technology CoLtd |
| Hana Financial vs. Ananti Inc | Hana Financial vs. SS TECH | Hana Financial vs. Vieworks Co | Hana Financial vs. Shinsung Delta Tech |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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