Correlation Between Daewoo SBI and Haitai Confectionery
Can any of the company-specific risk be diversified away by investing in both Daewoo SBI and Haitai Confectionery 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 Daewoo SBI and Haitai Confectionery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daewoo SBI SPAC and Haitai Confectionery Foods, you can compare the effects of market volatilities on Daewoo SBI and Haitai Confectionery 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 Daewoo SBI with a short position of Haitai Confectionery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewoo SBI and Haitai Confectionery.
Diversification Opportunities for Daewoo SBI and Haitai Confectionery
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Daewoo and Haitai is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Daewoo SBI SPAC and Haitai Confectionery Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haitai Confectionery and Daewoo SBI 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 Daewoo SBI SPAC are associated (or correlated) with Haitai Confectionery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haitai Confectionery has no effect on the direction of Daewoo SBI i.e., Daewoo SBI and Haitai Confectionery go up and down completely randomly.
Pair Corralation between Daewoo SBI and Haitai Confectionery
Assuming the 90 days trading horizon Daewoo SBI SPAC is expected to under-perform the Haitai Confectionery. But the stock apears to be less risky and, when comparing its historical volatility, Daewoo SBI SPAC is 1.34 times less risky than Haitai Confectionery. The stock trades about -0.08 of its potential returns per unit of risk. The Haitai Confectionery Foods is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 566,734 in Haitai Confectionery Foods on August 29, 2024 and sell it today you would earn a total of 39,266 from holding Haitai Confectionery Foods or generate 6.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewoo SBI SPAC vs. Haitai Confectionery Foods
Performance |
| Timeline |
| Daewoo SBI SPAC |
| Haitai Confectionery |
Daewoo SBI and Haitai Confectionery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewoo SBI and Haitai Confectionery
The main advantage of trading using opposite Daewoo SBI and Haitai Confectionery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewoo SBI position performs unexpectedly, Haitai Confectionery 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 Haitai Confectionery will offset losses from the drop in Haitai Confectionery's long position.| Daewoo SBI vs. Deutsch Motors | Daewoo SBI vs. Hanjinkal | Daewoo SBI vs. Busan Industrial Co | Daewoo SBI vs. Busan Ind |
| Haitai Confectionery vs. AptaBio Therapeutics | Haitai Confectionery vs. Daewoo SBI SPAC | Haitai Confectionery vs. Dream Security co | Haitai Confectionery vs. Microfriend |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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