Correlation Between Hanjinkal and Korean Drug
Can any of the company-specific risk be diversified away by investing in both Hanjinkal and Korean Drug 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 Hanjinkal and Korean Drug into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanjinkal and Korean Drug Co, you can compare the effects of market volatilities on Hanjinkal and Korean Drug 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 Hanjinkal with a short position of Korean Drug. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjinkal and Korean Drug.
Diversification Opportunities for Hanjinkal and Korean Drug
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hanjinkal and Korean is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Hanjinkal and Korean Drug Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korean Drug and Hanjinkal 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 Hanjinkal are associated (or correlated) with Korean Drug. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korean Drug has no effect on the direction of Hanjinkal i.e., Hanjinkal and Korean Drug go up and down completely randomly.
Pair Corralation between Hanjinkal and Korean Drug
Assuming the 90 days trading horizon Hanjinkal is expected to generate 1.79 times more return on investment than Korean Drug. However, Hanjinkal is 1.79 times more volatile than Korean Drug Co. It trades about -0.08 of its potential returns per unit of risk. Korean Drug Co is currently generating about -0.25 per unit of risk. If you would invest 8,460,000 in Hanjinkal on September 1, 2024 and sell it today you would lose (410,000) from holding Hanjinkal or give up 4.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hanjinkal vs. Korean Drug Co
Performance |
| Timeline |
| Hanjinkal |
| Korean Drug |
Hanjinkal and Korean Drug Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjinkal and Korean Drug
The main advantage of trading using opposite Hanjinkal and Korean Drug positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjinkal position performs unexpectedly, Korean Drug 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 Korean Drug will offset losses from the drop in Korean Drug's long position.| Hanjinkal vs. Hanjoo Light Metal | Hanjinkal vs. Polaris Office Corp | Hanjinkal vs. Daiyang Metal Co | Hanjinkal vs. Choil Aluminum |
| Korean Drug vs. Digital Power Communications | Korean Drug vs. Grand Korea Leisure | Korean Drug vs. ITM Semiconductor Co | Korean Drug vs. Shinsegae Information Communication |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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