Correlation Between Haitai Confectionery and SBI Investment
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and SBI Investment 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 SBI Investment 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 SBI Investment KOREA, you can compare the effects of market volatilities on Haitai Confectionery and SBI Investment 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 SBI Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and SBI Investment.
Diversification Opportunities for Haitai Confectionery and SBI Investment
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Haitai and SBI is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and SBI Investment KOREA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Investment KOREA 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 SBI Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Investment KOREA has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and SBI Investment go up and down completely randomly.
Pair Corralation between Haitai Confectionery and SBI Investment
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 0.9 times more return on investment than SBI Investment. However, Haitai Confectionery Foods is 1.11 times less risky than SBI Investment. It trades about 0.24 of its potential returns per unit of risk. SBI Investment KOREA is currently generating about 0.14 per unit of risk. If you would invest 550,994 in Haitai Confectionery Foods on October 7, 2024 and sell it today you would earn a total of 61,006 from holding Haitai Confectionery Foods or generate 11.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haitai Confectionery Foods vs. SBI Investment KOREA
Performance |
| Timeline |
| Haitai Confectionery |
| SBI Investment KOREA |
Haitai Confectionery and SBI Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and SBI Investment
The main advantage of trading using opposite Haitai Confectionery and SBI Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, SBI Investment 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 SBI Investment will offset losses from the drop in SBI Investment's long position.| Haitai Confectionery vs. TOPMATERIAL LTD | Haitai Confectionery vs. Songwon Industrial Co | Haitai Confectionery vs. Eagon Industrial Co | Haitai Confectionery vs. Hwasung Industrial Co |
| SBI Investment vs. Dongkuk Structures Construction | SBI Investment vs. Tuksu Engineering ConstructionLtd | SBI Investment vs. Semyung Electric Machinery | SBI Investment vs. Hanshin Construction 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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