Correlation Between Hanjoo Light and Cosmecca Korea
Can any of the company-specific risk be diversified away by investing in both Hanjoo Light and Cosmecca Korea 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 Cosmecca Korea 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 Cosmecca Korea Co, you can compare the effects of market volatilities on Hanjoo Light and Cosmecca Korea 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 Cosmecca Korea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjoo Light and Cosmecca Korea.
Diversification Opportunities for Hanjoo Light and Cosmecca Korea
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hanjoo and Cosmecca is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Hanjoo Light Metal and Cosmecca Korea Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmecca Korea 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 Cosmecca Korea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmecca Korea has no effect on the direction of Hanjoo Light i.e., Hanjoo Light and Cosmecca Korea go up and down completely randomly.
Pair Corralation between Hanjoo Light and Cosmecca Korea
Assuming the 90 days trading horizon Hanjoo Light Metal is expected to under-perform the Cosmecca Korea. In addition to that, Hanjoo Light is 1.02 times more volatile than Cosmecca Korea Co. It trades about -0.11 of its total potential returns per unit of risk. Cosmecca Korea Co is currently generating about 0.04 per unit of volatility. If you would invest 3,965,000 in Cosmecca Korea Co on September 4, 2024 and sell it today you would earn a total of 925,000 from holding Cosmecca Korea Co or generate 23.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjoo Light Metal vs. Cosmecca Korea Co
Performance |
| Timeline |
| Hanjoo Light Metal |
| Cosmecca Korea |
Hanjoo Light and Cosmecca Korea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjoo Light and Cosmecca Korea
The main advantage of trading using opposite Hanjoo Light and Cosmecca Korea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjoo Light position performs unexpectedly, Cosmecca Korea 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 Cosmecca Korea will offset losses from the drop in Cosmecca Korea'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 |
| Cosmecca Korea vs. Raontech | Cosmecca Korea vs. Namhwa Industrial Co | Cosmecca Korea vs. Shinsung Delta Tech | Cosmecca Korea vs. PNC Technologies co |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |