Correlation Between Haitai Confectionery and Nature
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and Nature 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 Nature 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 Nature and Environment, you can compare the effects of market volatilities on Haitai Confectionery and Nature 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 Nature. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and Nature.
Diversification Opportunities for Haitai Confectionery and Nature
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Haitai and Nature is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and Nature and Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nature and Environment 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 Nature. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nature and Environment has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and Nature go up and down completely randomly.
Pair Corralation between Haitai Confectionery and Nature
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 0.88 times more return on investment than Nature. However, Haitai Confectionery Foods is 1.14 times less risky than Nature. It trades about 0.01 of its potential returns per unit of risk. Nature and Environment is currently generating about -0.04 per unit of risk. If you would invest 583,119 in Haitai Confectionery Foods on September 4, 2024 and sell it today you would lose (13,119) from holding Haitai Confectionery Foods or give up 2.25% 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. Nature and Environment
Performance |
| Timeline |
| Haitai Confectionery |
| Nature and Environment |
Haitai Confectionery and Nature Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and Nature
The main advantage of trading using opposite Haitai Confectionery and Nature positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, Nature 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 Nature will offset losses from the drop in Nature's long position.| Haitai Confectionery vs. Kaonmedia Co | Haitai Confectionery vs. Jeju Air Co | Haitai Confectionery vs. Kakao Games Corp | Haitai Confectionery vs. Nasmedia Co |
| Nature vs. Kyung In Synthetic Corp | Nature vs. Pureun Mutual Savings | Nature vs. GS Retail Co | Nature vs. Hannong Chemicals |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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