Correlation Between ABOV Semiconductor and Hana Materials
Can any of the company-specific risk be diversified away by investing in both ABOV Semiconductor and Hana Materials 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 ABOV Semiconductor and Hana Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ABOV Semiconductor Co and Hana Materials, you can compare the effects of market volatilities on ABOV Semiconductor and Hana Materials 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 ABOV Semiconductor with a short position of Hana Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of ABOV Semiconductor and Hana Materials.
Diversification Opportunities for ABOV Semiconductor and Hana Materials
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ABOV and Hana is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding ABOV Semiconductor Co and Hana Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Materials and ABOV Semiconductor 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 ABOV Semiconductor Co are associated (or correlated) with Hana Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Materials has no effect on the direction of ABOV Semiconductor i.e., ABOV Semiconductor and Hana Materials go up and down completely randomly.
Pair Corralation between ABOV Semiconductor and Hana Materials
Assuming the 90 days trading horizon ABOV Semiconductor is expected to generate 1.02 times less return on investment than Hana Materials. In addition to that, ABOV Semiconductor is 1.16 times more volatile than Hana Materials. It trades about 0.11 of its total potential returns per unit of risk. Hana Materials is currently generating about 0.13 per unit of volatility. If you would invest 2,300,000 in Hana Materials on October 30, 2024 and sell it today you would earn a total of 355,000 from holding Hana Materials or generate 15.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ABOV Semiconductor Co vs. Hana Materials
Performance |
| Timeline |
| ABOV Semiconductor |
| Hana Materials |
ABOV Semiconductor and Hana Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ABOV Semiconductor and Hana Materials
The main advantage of trading using opposite ABOV Semiconductor and Hana Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ABOV Semiconductor position performs unexpectedly, Hana Materials 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 Hana Materials will offset losses from the drop in Hana Materials' long position.| ABOV Semiconductor vs. Jeong Moon Information | ABOV Semiconductor vs. Nice Information Telecommunication | ABOV Semiconductor vs. Daol Investment Securities | ABOV Semiconductor vs. E Investment Development |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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