Correlation Between Pyung Hwa and NH Investment
Can any of the company-specific risk be diversified away by investing in both Pyung Hwa and NH Investment 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 Pyung Hwa and NH Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pyung Hwa Industrial and NH Investment Securities, you can compare the effects of market volatilities on Pyung Hwa and NH Investment 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 Pyung Hwa with a short position of NH Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pyung Hwa and NH Investment.
Diversification Opportunities for Pyung Hwa and NH Investment
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Pyung and 005940 is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Pyung Hwa Industrial and NH Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Investment Securities and Pyung Hwa 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 Pyung Hwa Industrial are associated (or correlated) with NH Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Investment Securities has no effect on the direction of Pyung Hwa i.e., Pyung Hwa and NH Investment go up and down completely randomly.
Pair Corralation between Pyung Hwa and NH Investment
Assuming the 90 days trading horizon Pyung Hwa Industrial is expected to generate 2.54 times more return on investment than NH Investment. However, Pyung Hwa is 2.54 times more volatile than NH Investment Securities. It trades about 0.07 of its potential returns per unit of risk. NH Investment Securities is currently generating about 0.0 per unit of risk. If you would invest 91,000 in Pyung Hwa Industrial on October 24, 2024 and sell it today you would earn a total of 2,600 from holding Pyung Hwa Industrial or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pyung Hwa Industrial vs. NH Investment Securities
Performance |
| Timeline |
| Pyung Hwa Industrial |
| NH Investment Securities |
Pyung Hwa and NH Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pyung Hwa and NH Investment
The main advantage of trading using opposite Pyung Hwa and NH Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pyung Hwa position performs unexpectedly, NH Investment 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 NH Investment will offset losses from the drop in NH Investment's long position.| Pyung Hwa vs. AptaBio Therapeutics | Pyung Hwa vs. Daewoo SBI SPAC | Pyung Hwa vs. Dream Security co | Pyung Hwa vs. Microfriend |
| NH Investment vs. Seoul Food Industrial | NH Investment vs. Pyung Hwa Industrial | NH Investment vs. Samyang Foods Co | NH Investment vs. Korea Shipbuilding Offshore |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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