Correlation Between Haitai Confectionery and Kukil Metal
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and Kukil Metal 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 Kukil Metal 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 Kukil Metal Co, you can compare the effects of market volatilities on Haitai Confectionery and Kukil Metal 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 Kukil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and Kukil Metal.
Diversification Opportunities for Haitai Confectionery and Kukil Metal
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Haitai and Kukil is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and Kukil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kukil Metal 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 Kukil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kukil Metal has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and Kukil Metal go up and down completely randomly.
Pair Corralation between Haitai Confectionery and Kukil Metal
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 1.27 times more return on investment than Kukil Metal. However, Haitai Confectionery is 1.27 times more volatile than Kukil Metal Co. It trades about 0.05 of its potential returns per unit of risk. Kukil Metal Co is currently generating about -0.11 per unit of risk. If you would invest 570,361 in Haitai Confectionery Foods on October 14, 2024 and sell it today you would earn a total of 31,639 from holding Haitai Confectionery Foods or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haitai Confectionery Foods vs. Kukil Metal Co
Performance |
| Timeline |
| Haitai Confectionery |
| Kukil Metal |
Haitai Confectionery and Kukil Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and Kukil Metal
The main advantage of trading using opposite Haitai Confectionery and Kukil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, Kukil Metal 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 Kukil Metal will offset losses from the drop in Kukil Metal's long position.| Haitai Confectionery vs. ABCO Electronics Co | Haitai Confectionery vs. KyungIn Electronics Co | Haitai Confectionery vs. Wave Electronics Co | Haitai Confectionery vs. Samsung Life Insurance |
| Kukil Metal vs. FOODWELL Co | Kukil Metal vs. Haitai Confectionery Foods | Kukil Metal vs. Daejung Chemicals Metals | Kukil Metal vs. Samyang Foods 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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