Correlation Between Namhwa Industrial and Amogreentech
Can any of the company-specific risk be diversified away by investing in both Namhwa Industrial and Amogreentech 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 Namhwa Industrial and Amogreentech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Namhwa Industrial Co and Amogreentech Co, you can compare the effects of market volatilities on Namhwa Industrial and Amogreentech 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 Namhwa Industrial with a short position of Amogreentech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Namhwa Industrial and Amogreentech.
Diversification Opportunities for Namhwa Industrial and Amogreentech
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Namhwa and Amogreentech is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Namhwa Industrial Co and Amogreentech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amogreentech and Namhwa Industrial 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 Namhwa Industrial Co are associated (or correlated) with Amogreentech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amogreentech has no effect on the direction of Namhwa Industrial i.e., Namhwa Industrial and Amogreentech go up and down completely randomly.
Pair Corralation between Namhwa Industrial and Amogreentech
Assuming the 90 days trading horizon Namhwa Industrial Co is expected to generate 1.1 times more return on investment than Amogreentech. However, Namhwa Industrial is 1.1 times more volatile than Amogreentech Co. It trades about 0.16 of its potential returns per unit of risk. Amogreentech Co is currently generating about -0.02 per unit of risk. If you would invest 510,261 in Namhwa Industrial Co on October 16, 2024 and sell it today you would earn a total of 27,739 from holding Namhwa Industrial Co or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Namhwa Industrial Co vs. Amogreentech Co
Performance |
| Timeline |
| Namhwa Industrial |
| Amogreentech |
Namhwa Industrial and Amogreentech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Namhwa Industrial and Amogreentech
The main advantage of trading using opposite Namhwa Industrial and Amogreentech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Namhwa Industrial position performs unexpectedly, Amogreentech 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 Amogreentech will offset losses from the drop in Amogreentech's long position.| Namhwa Industrial vs. DSC Investment | Namhwa Industrial vs. Samick Musical Instruments | Namhwa Industrial vs. Coloray International Investment | Namhwa Industrial vs. Golden Bridge Investment |
| Amogreentech vs. ENERGYMACHINERY KOREA CoLtd | Amogreentech vs. Hanshin Construction Co | Amogreentech vs. Okins Electronics Co | Amogreentech vs. Seoam Machinery Industry |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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