Correlation Between Alton Sports and NH Investment
Can any of the company-specific risk be diversified away by investing in both Alton Sports and NH Investment 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 Alton Sports and NH Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alton Sports CoLtd and NH Investment Securities, you can compare the effects of market volatilities on Alton Sports and NH Investment 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 Alton Sports with a short position of NH Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alton Sports and NH Investment.
Diversification Opportunities for Alton Sports and NH Investment
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Alton and 005940 is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Alton Sports CoLtd and NH Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Investment Securities and Alton Sports 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 Alton Sports CoLtd are associated (or correlated) with NH Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Investment Securities has no effect on the direction of Alton Sports i.e., Alton Sports and NH Investment go up and down completely randomly.
Pair Corralation between Alton Sports and NH Investment
Assuming the 90 days trading horizon Alton Sports CoLtd is expected to under-perform the NH Investment. But the stock apears to be less risky and, when comparing its historical volatility, Alton Sports CoLtd is 1.02 times less risky than NH Investment. The stock trades about -0.25 of its potential returns per unit of risk. The NH Investment Securities is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,444,000 in NH Investment Securities on November 27, 2024 and sell it today you would earn a total of 58,000 from holding NH Investment Securities or generate 4.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alton Sports CoLtd vs. NH Investment Securities
Performance |
| Timeline |
| Alton Sports CoLtd |
| NH Investment Securities |
Alton Sports and NH Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alton Sports and NH Investment
The main advantage of trading using opposite Alton Sports and NH Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alton Sports position performs unexpectedly, NH Investment 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 NH Investment will offset losses from the drop in NH Investment's long position.| Alton Sports vs. Grand Korea Leisure | Alton Sports vs. Haesung Industrial Co | Alton Sports vs. Seoyon Topmetal Co | Alton Sports vs. PlayD Co |
| NH Investment vs. SV Investment | NH Investment vs. Green Cross Medical | NH Investment vs. Daol Investment Securities | NH Investment vs. E Investment Development |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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