Correlation Between HJ ShipBuilding and Innowireless
Can any of the company-specific risk be diversified away by investing in both HJ ShipBuilding and Innowireless 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 Innowireless 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 Innowireless Co, you can compare the effects of market volatilities on HJ ShipBuilding and Innowireless 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 Innowireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of HJ ShipBuilding and Innowireless.
Diversification Opportunities for HJ ShipBuilding and Innowireless
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 097230 and Innowireless is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding HJ ShipBuilding Construction and Innowireless Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innowireless 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 Innowireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innowireless has no effect on the direction of HJ ShipBuilding i.e., HJ ShipBuilding and Innowireless go up and down completely randomly.
Pair Corralation between HJ ShipBuilding and Innowireless
Assuming the 90 days trading horizon HJ ShipBuilding Construction is expected to generate 1.28 times more return on investment than Innowireless. However, HJ ShipBuilding is 1.28 times more volatile than Innowireless Co. It trades about 0.02 of its potential returns per unit of risk. Innowireless Co is currently generating about -0.04 per unit of risk. If you would invest 412,500 in HJ ShipBuilding Construction on September 2, 2024 and sell it today you would earn a total of 43,000 from holding HJ ShipBuilding Construction or generate 10.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
HJ ShipBuilding Construction vs. Innowireless Co
Performance |
| Timeline |
| HJ ShipBuilding Cons |
| Innowireless |
HJ ShipBuilding and Innowireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HJ ShipBuilding and Innowireless
The main advantage of trading using opposite HJ ShipBuilding and Innowireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HJ ShipBuilding position performs unexpectedly, Innowireless 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 Innowireless will offset losses from the drop in Innowireless' long position.| HJ ShipBuilding vs. Korea New Network | HJ ShipBuilding vs. ICD Co | HJ ShipBuilding vs. DYPNF CoLtd | HJ ShipBuilding vs. Busan Industrial Co |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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