Correlation Between HJ ShipBuilding and SEOJEON ELECTRIC
Can any of the company-specific risk be diversified away by investing in both HJ ShipBuilding and SEOJEON ELECTRIC 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 SEOJEON ELECTRIC 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 SEOJEON ELECTRIC MACHINERY, you can compare the effects of market volatilities on HJ ShipBuilding and SEOJEON ELECTRIC 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 SEOJEON ELECTRIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of HJ ShipBuilding and SEOJEON ELECTRIC.
Diversification Opportunities for HJ ShipBuilding and SEOJEON ELECTRIC
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between 097230 and SEOJEON is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding HJ ShipBuilding Construction and SEOJEON ELECTRIC MACHINERY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEOJEON ELECTRIC MAC 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 SEOJEON ELECTRIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEOJEON ELECTRIC MAC has no effect on the direction of HJ ShipBuilding i.e., HJ ShipBuilding and SEOJEON ELECTRIC go up and down completely randomly.
Pair Corralation between HJ ShipBuilding and SEOJEON ELECTRIC
Assuming the 90 days trading horizon HJ ShipBuilding Construction is expected to generate 1.98 times more return on investment than SEOJEON ELECTRIC. However, HJ ShipBuilding is 1.98 times more volatile than SEOJEON ELECTRIC MACHINERY. It trades about 0.07 of its potential returns per unit of risk. SEOJEON ELECTRIC MACHINERY is currently generating about 0.09 per unit of risk. If you would invest 611,000 in HJ ShipBuilding Construction on November 27, 2024 and sell it today you would earn a total of 23,000 from holding HJ ShipBuilding Construction or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HJ ShipBuilding Construction vs. SEOJEON ELECTRIC MACHINERY
Performance |
| Timeline |
| HJ ShipBuilding Cons |
| SEOJEON ELECTRIC MAC |
HJ ShipBuilding and SEOJEON ELECTRIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HJ ShipBuilding and SEOJEON ELECTRIC
The main advantage of trading using opposite HJ ShipBuilding and SEOJEON ELECTRIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HJ ShipBuilding position performs unexpectedly, SEOJEON ELECTRIC 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 SEOJEON ELECTRIC will offset losses from the drop in SEOJEON ELECTRIC's long position.| HJ ShipBuilding vs. Cube Entertainment | HJ ShipBuilding vs. Pan Entertainment Co | HJ ShipBuilding vs. SM Entertainment Co | HJ ShipBuilding vs. JYP Entertainment Corp |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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