Correlation Between Haitai Confectionery and FoodNamoo
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and FoodNamoo 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 FoodNamoo 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 FoodNamoo, you can compare the effects of market volatilities on Haitai Confectionery and FoodNamoo 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 FoodNamoo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and FoodNamoo.
Diversification Opportunities for Haitai Confectionery and FoodNamoo
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Haitai and FoodNamoo is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and FoodNamoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FoodNamoo 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 FoodNamoo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FoodNamoo has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and FoodNamoo go up and down completely randomly.
Pair Corralation between Haitai Confectionery and FoodNamoo
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 0.76 times more return on investment than FoodNamoo. However, Haitai Confectionery Foods is 1.32 times less risky than FoodNamoo. It trades about -0.04 of its potential returns per unit of risk. FoodNamoo is currently generating about -0.14 per unit of risk. If you would invest 595,538 in Haitai Confectionery Foods on November 6, 2024 and sell it today you would lose (32,538) from holding Haitai Confectionery Foods or give up 5.46% 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. FoodNamoo
Performance |
| Timeline |
| Haitai Confectionery |
| FoodNamoo |
Haitai Confectionery and FoodNamoo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and FoodNamoo
The main advantage of trading using opposite Haitai Confectionery and FoodNamoo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, FoodNamoo 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 FoodNamoo will offset losses from the drop in FoodNamoo's long position.| Haitai Confectionery vs. SEOWONINTECHCoLtd | Haitai Confectionery vs. KMH Hitech Co | Haitai Confectionery vs. Dongwoon Anatech Co | Haitai Confectionery vs. Mirai Semiconductors Co |
| FoodNamoo vs. Hanjin Transportation Co | FoodNamoo vs. Homecast CoLtd | FoodNamoo vs. Hyundai Home Shopping | FoodNamoo vs. ECSTELECOM 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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