Correlation Between HJ ShipBuilding and ATON
Can any of the company-specific risk be diversified away by investing in both HJ ShipBuilding and ATON 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 ATON 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 ATON Inc, you can compare the effects of market volatilities on HJ ShipBuilding and ATON 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 ATON. Check out your portfolio center. Please also check ongoing floating volatility patterns of HJ ShipBuilding and ATON.
Diversification Opportunities for HJ ShipBuilding and ATON
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 097230 and ATON is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding HJ ShipBuilding Construction and ATON Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATON Inc 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 ATON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATON Inc has no effect on the direction of HJ ShipBuilding i.e., HJ ShipBuilding and ATON go up and down completely randomly.
Pair Corralation between HJ ShipBuilding and ATON
Assuming the 90 days trading horizon HJ ShipBuilding Construction is expected to generate 0.97 times more return on investment than ATON. However, HJ ShipBuilding Construction is 1.03 times less risky than ATON. It trades about 0.02 of its potential returns per unit of risk. ATON Inc is currently generating about 0.01 per unit of risk. If you would invest 412,000 in HJ ShipBuilding Construction on September 5, 2024 and sell it today you would earn a total of 23,000 from holding HJ ShipBuilding Construction or generate 5.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.34% |
| Values | Daily Returns |
HJ ShipBuilding Construction vs. ATON Inc
Performance |
| Timeline |
| HJ ShipBuilding Cons |
| ATON Inc |
HJ ShipBuilding and ATON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HJ ShipBuilding and ATON
The main advantage of trading using opposite HJ ShipBuilding and ATON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HJ ShipBuilding position performs unexpectedly, ATON 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 ATON will offset losses from the drop in ATON's long position.| HJ ShipBuilding vs. Okins Electronics Co | HJ ShipBuilding vs. ABCO Electronics Co | HJ ShipBuilding vs. Sunny Electronics Corp | HJ ShipBuilding vs. Sungmoon Electronics 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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