Correlation Between Haitai Confectionery and DB Financial
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and DB Financial 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 Haitai Confectionery and DB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Haitai Confectionery Foods and DB Financial Investment, you can compare the effects of market volatilities on Haitai Confectionery and DB Financial 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 Haitai Confectionery with a short position of DB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and DB Financial.
Diversification Opportunities for Haitai Confectionery and DB Financial
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haitai and 016610 is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and DB Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Financial Investment and Haitai Confectionery 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 Haitai Confectionery Foods are associated (or correlated) with DB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Financial Investment has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and DB Financial go up and down completely randomly.
Pair Corralation between Haitai Confectionery and DB Financial
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to under-perform the DB Financial. In addition to that, Haitai Confectionery is 1.44 times more volatile than DB Financial Investment. It trades about -0.17 of its total potential returns per unit of risk. DB Financial Investment is currently generating about -0.16 per unit of volatility. If you would invest 542,000 in DB Financial Investment on September 2, 2024 and sell it today you would lose (26,000) from holding DB Financial Investment or give up 4.8% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haitai Confectionery Foods vs. DB Financial Investment
Performance |
| Timeline |
| Haitai Confectionery |
| DB Financial Investment |
Haitai Confectionery and DB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and DB Financial
The main advantage of trading using opposite Haitai Confectionery and DB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, DB Financial 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 DB Financial will offset losses from the drop in DB Financial's long position.| Haitai Confectionery vs. AptaBio Therapeutics | Haitai Confectionery vs. Daewoo SBI SPAC | Haitai Confectionery vs. Dream Security co | Haitai Confectionery vs. Microfriend |
| DB Financial vs. Samsung Electronics Co | DB Financial vs. Samsung Electronics Co | DB Financial vs. KB Financial Group | DB Financial vs. Shinhan Financial Group |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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