Correlation Between Haitai Confectionery and DAEDUCK ELECTRONICS
Can any of the company-specific risk be diversified away by investing in both Haitai Confectionery and DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS CoLtd, you can compare the effects of market volatilities on Haitai Confectionery and DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haitai Confectionery and DAEDUCK ELECTRONICS.
Diversification Opportunities for Haitai Confectionery and DAEDUCK ELECTRONICS
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Haitai and DAEDUCK is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Haitai Confectionery Foods and DAEDUCK ELECTRONICS CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAEDUCK ELECTRONICS CoLtd 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 DAEDUCK ELECTRONICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAEDUCK ELECTRONICS CoLtd has no effect on the direction of Haitai Confectionery i.e., Haitai Confectionery and DAEDUCK ELECTRONICS go up and down completely randomly.
Pair Corralation between Haitai Confectionery and DAEDUCK ELECTRONICS
Assuming the 90 days trading horizon Haitai Confectionery Foods is expected to generate 1.38 times more return on investment than DAEDUCK ELECTRONICS. However, Haitai Confectionery is 1.38 times more volatile than DAEDUCK ELECTRONICS CoLtd. It trades about 0.07 of its potential returns per unit of risk. DAEDUCK ELECTRONICS CoLtd is currently generating about -0.06 per unit of risk. If you would invest 567,000 in Haitai Confectionery Foods on August 29, 2024 and sell it today you would earn a total of 39,000 from holding Haitai Confectionery Foods or generate 6.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Haitai Confectionery Foods vs. DAEDUCK ELECTRONICS CoLtd
Performance |
| Timeline |
| Haitai Confectionery |
| DAEDUCK ELECTRONICS CoLtd |
Haitai Confectionery and DAEDUCK ELECTRONICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Haitai Confectionery and DAEDUCK ELECTRONICS
The main advantage of trading using opposite Haitai Confectionery and DAEDUCK ELECTRONICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haitai Confectionery position performs unexpectedly, DAEDUCK ELECTRONICS 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 DAEDUCK ELECTRONICS will offset losses from the drop in DAEDUCK ELECTRONICS's long position.| Haitai Confectionery vs. WooDeumGee Farm Co, | Haitai Confectionery vs. Wireless Power Amplifier | Haitai Confectionery vs. Miwon Chemicals Co | Haitai Confectionery vs. Playgram Co |
| DAEDUCK ELECTRONICS vs. Samji Electronics Co | DAEDUCK ELECTRONICS vs. Samlip General Foods | DAEDUCK ELECTRONICS vs. LG Electronics Pfd | DAEDUCK ELECTRONICS vs. Sam Yang Foods |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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