Correlation Between HJ ShipBuilding and Sungdo Engineering
Can any of the company-specific risk be diversified away by investing in both HJ ShipBuilding and Sungdo Engineering 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 HJ ShipBuilding and Sungdo Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HJ ShipBuilding Construction and Sungdo Engineering Construction, you can compare the effects of market volatilities on HJ ShipBuilding and Sungdo Engineering 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 HJ ShipBuilding with a short position of Sungdo Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of HJ ShipBuilding and Sungdo Engineering.
Diversification Opportunities for HJ ShipBuilding and Sungdo Engineering
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 097230 and Sungdo is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding HJ ShipBuilding Construction and Sungdo Engineering Constructio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sungdo Engineering and HJ ShipBuilding 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 HJ ShipBuilding Construction are associated (or correlated) with Sungdo Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sungdo Engineering has no effect on the direction of HJ ShipBuilding i.e., HJ ShipBuilding and Sungdo Engineering go up and down completely randomly.
Pair Corralation between HJ ShipBuilding and Sungdo Engineering
Assuming the 90 days trading horizon HJ ShipBuilding Construction is expected to generate 1.16 times more return on investment than Sungdo Engineering. However, HJ ShipBuilding is 1.16 times more volatile than Sungdo Engineering Construction. It trades about 0.01 of its potential returns per unit of risk. Sungdo Engineering Construction is currently generating about 0.01 per unit of risk. If you would invest 396,000 in HJ ShipBuilding Construction on September 13, 2024 and sell it today you would lose (13,500) from holding HJ ShipBuilding Construction or give up 3.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HJ ShipBuilding Construction vs. Sungdo Engineering Constructio
Performance |
| Timeline |
| HJ ShipBuilding Cons |
| Sungdo Engineering |
HJ ShipBuilding and Sungdo Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HJ ShipBuilding and Sungdo Engineering
The main advantage of trading using opposite HJ ShipBuilding and Sungdo Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HJ ShipBuilding position performs unexpectedly, Sungdo Engineering 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 Sungdo Engineering will offset losses from the drop in Sungdo Engineering's long position.| HJ ShipBuilding vs. Kisan Telecom Co | HJ ShipBuilding vs. Korean Drug Co | HJ ShipBuilding vs. CJ Seafood Corp | HJ ShipBuilding vs. Sejong Telecom |
| Sungdo Engineering vs. Hwangkum Steel Technology | Sungdo Engineering vs. Spolytech Co | Sungdo Engineering vs. Vitzro Tech Co | Sungdo Engineering vs. Lion Chemtech 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |