Correlation Between Hana Materials and Wonbang Tech
Can any of the company-specific risk be diversified away by investing in both Hana Materials and Wonbang Tech 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 Wonbang Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Materials and Wonbang Tech Co, you can compare the effects of market volatilities on Hana Materials and Wonbang Tech 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 Wonbang Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Materials and Wonbang Tech.
Diversification Opportunities for Hana Materials and Wonbang Tech
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hana and Wonbang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Hana Materials and Wonbang Tech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonbang Tech 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 Wonbang Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonbang Tech has no effect on the direction of Hana Materials i.e., Hana Materials and Wonbang Tech go up and down completely randomly.
Pair Corralation between Hana Materials and Wonbang Tech
Assuming the 90 days trading horizon Hana Materials is expected to generate 1.5 times more return on investment than Wonbang Tech. However, Hana Materials is 1.5 times more volatile than Wonbang Tech Co. It trades about 0.12 of its potential returns per unit of risk. Wonbang Tech Co is currently generating about 0.13 per unit of risk. If you would invest 2,280,000 in Hana Materials on November 3, 2024 and sell it today you would earn a total of 180,000 from holding Hana Materials or generate 7.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Hana Materials vs. Wonbang Tech Co
Performance |
| Timeline |
| Hana Materials |
| Wonbang Tech |
Hana Materials and Wonbang Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Materials and Wonbang Tech
The main advantage of trading using opposite Hana Materials and Wonbang Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Materials position performs unexpectedly, Wonbang Tech 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 Wonbang Tech will offset losses from the drop in Wonbang Tech's long position.| Hana Materials vs. Chorokbaem Healthcare Co | Hana Materials vs. Golden Bridge Investment | Hana Materials vs. DSC Investment | Hana Materials vs. LEENO Industrial |
| Wonbang Tech vs. Seohee Construction Co | Wonbang Tech vs. MediaZen | Wonbang Tech vs. Tuksu Engineering ConstructionLtd | Wonbang Tech vs. SEOJEON ELECTRIC MACHINERY |
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 CEOs Directory module to screen CEOs from public companies around the world.
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