Correlation Between Hanjoo Light and Heungkuk Metaltech
Can any of the company-specific risk be diversified away by investing in both Hanjoo Light and Heungkuk Metaltech 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 Hanjoo Light and Heungkuk Metaltech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanjoo Light Metal and Heungkuk Metaltech CoLtd, you can compare the effects of market volatilities on Hanjoo Light and Heungkuk Metaltech 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 Hanjoo Light with a short position of Heungkuk Metaltech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjoo Light and Heungkuk Metaltech.
Diversification Opportunities for Hanjoo Light and Heungkuk Metaltech
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hanjoo and Heungkuk is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Hanjoo Light Metal and Heungkuk Metaltech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heungkuk Metaltech CoLtd and Hanjoo Light 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 Hanjoo Light Metal are associated (or correlated) with Heungkuk Metaltech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heungkuk Metaltech CoLtd has no effect on the direction of Hanjoo Light i.e., Hanjoo Light and Heungkuk Metaltech go up and down completely randomly.
Pair Corralation between Hanjoo Light and Heungkuk Metaltech
Assuming the 90 days trading horizon Hanjoo Light Metal is expected to generate 0.97 times more return on investment than Heungkuk Metaltech. However, Hanjoo Light Metal is 1.03 times less risky than Heungkuk Metaltech. It trades about 0.08 of its potential returns per unit of risk. Heungkuk Metaltech CoLtd is currently generating about -0.14 per unit of risk. If you would invest 77,600 in Hanjoo Light Metal on November 9, 2024 and sell it today you would earn a total of 1,600 from holding Hanjoo Light Metal or generate 2.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjoo Light Metal vs. Heungkuk Metaltech CoLtd
Performance |
| Timeline |
| Hanjoo Light Metal |
| Heungkuk Metaltech CoLtd |
Hanjoo Light and Heungkuk Metaltech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjoo Light and Heungkuk Metaltech
The main advantage of trading using opposite Hanjoo Light and Heungkuk Metaltech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjoo Light position performs unexpectedly, Heungkuk Metaltech 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 Heungkuk Metaltech will offset losses from the drop in Heungkuk Metaltech's long position.| Hanjoo Light vs. Samsung Electronics Co | Hanjoo Light vs. Samsung Electronics Co | Hanjoo Light vs. LG Energy Solution | Hanjoo Light vs. SK Hynix |
| Heungkuk Metaltech vs. Samsung Electronics Co | Heungkuk Metaltech vs. Samsung Electronics Co | Heungkuk Metaltech vs. Hyundai Motor Co | Heungkuk Metaltech vs. Hyundai Motor |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |