Correlation Between Hana Materials and Jeong Moon
Can any of the company-specific risk be diversified away by investing in both Hana Materials and Jeong Moon 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 Hana Materials and Jeong Moon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Materials and Jeong Moon Information, you can compare the effects of market volatilities on Hana Materials and Jeong Moon 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 Hana Materials with a short position of Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Materials and Jeong Moon.
Diversification Opportunities for Hana Materials and Jeong Moon
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hana and Jeong is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hana Materials and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information and Hana Materials 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 Hana Materials are associated (or correlated) with Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of Hana Materials i.e., Hana Materials and Jeong Moon go up and down completely randomly.
Pair Corralation between Hana Materials and Jeong Moon
Assuming the 90 days trading horizon Hana Materials is expected to under-perform the Jeong Moon. In addition to that, Hana Materials is 2.51 times more volatile than Jeong Moon Information. It trades about -0.15 of its total potential returns per unit of risk. Jeong Moon Information is currently generating about 0.11 per unit of volatility. If you would invest 80,900 in Jeong Moon Information on November 6, 2024 and sell it today you would earn a total of 2,300 from holding Jeong Moon Information or generate 2.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Materials vs. Jeong Moon Information
Performance |
| Timeline |
| Hana Materials |
| Jeong Moon Information |
Hana Materials and Jeong Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Materials and Jeong Moon
The main advantage of trading using opposite Hana Materials and Jeong Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Materials position performs unexpectedly, Jeong Moon 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 Jeong Moon will offset losses from the drop in Jeong Moon's long position.| Hana Materials vs. Coloray International Investment | Hana Materials vs. TS Investment Corp | Hana Materials vs. FOODWELL Co | Hana Materials vs. DSC Investment |
| Jeong Moon vs. System and Application | Jeong Moon vs. Hanjoo Light Metal | Jeong Moon vs. Koryo Credit Information | Jeong Moon vs. Shinhan Inverse Copper |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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