Correlation Between Haitai Confectionery and Samsung Publishing
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and Samsung Publishing 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 Samsung Publishing 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 Samsung Publishing Co, you can compare the effects of market volatilities on Haitai Confectionery and Samsung Publishing 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 Samsung Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and Samsung Publishing.
Diversification Opportunities for Haitai Confectionery and Samsung Publishing
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Haitai and Samsung is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and Samsung Publishing Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Publishing 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 Samsung Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Publishing has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and Samsung Publishing go up and down completely randomly.
Pair Corralation between Haitai Confectionery and Samsung Publishing
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 0.69 times more return on investment than Samsung Publishing. However, Haitai Confectionery Foods is 1.44 times less risky than Samsung Publishing. It trades about 0.01 of its potential returns per unit of risk. Samsung Publishing Co is currently generating about -0.01 per unit of risk. If you would invest 629,999 in Haitai Confectionery Foods on October 13, 2024 and sell it today you would lose (27,999) from holding Haitai Confectionery Foods or give up 4.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haitai Confectionery Foods vs. Samsung Publishing Co
Performance |
| Timeline |
| Haitai Confectionery |
| Samsung Publishing |
Haitai Confectionery and Samsung Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and Samsung Publishing
The main advantage of trading using opposite Haitai Confectionery and Samsung Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, Samsung Publishing 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 Samsung Publishing will offset losses from the drop in Samsung Publishing's long position.| Haitai Confectionery vs. Eagon Industrial Co | Haitai Confectionery vs. Songwon Industrial Co | Haitai Confectionery vs. Korea Information Communications | Haitai Confectionery vs. Formetal Co |
| Samsung Publishing vs. Haitai Confectionery Foods | Samsung Publishing vs. Daejung Chemicals Metals | Samsung Publishing vs. Kukil Metal Co | Samsung Publishing vs. Daewon Chemical 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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