Correlation Between Hana Financial and JNK Heaters
Can any of the company-specific risk be diversified away by investing in both Hana Financial and JNK Heaters 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 Financial and JNK Heaters into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Financial 7 and JNK Heaters Co, you can compare the effects of market volatilities on Hana Financial and JNK Heaters 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 Financial with a short position of JNK Heaters. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Financial and JNK Heaters.
Diversification Opportunities for Hana Financial and JNK Heaters
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hana and JNK is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hana Financial 7 and JNK Heaters Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JNK Heaters and Hana Financial 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 Financial 7 are associated (or correlated) with JNK Heaters. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JNK Heaters has no effect on the direction of Hana Financial i.e., Hana Financial and JNK Heaters go up and down completely randomly.
Pair Corralation between Hana Financial and JNK Heaters
Assuming the 90 days trading horizon Hana Financial 7 is expected to generate 1.86 times more return on investment than JNK Heaters. However, Hana Financial is 1.86 times more volatile than JNK Heaters Co. It trades about 0.52 of its potential returns per unit of risk. JNK Heaters Co is currently generating about -0.01 per unit of risk. If you would invest 793,000 in Hana Financial 7 on September 14, 2024 and sell it today you would earn a total of 675,000 from holding Hana Financial 7 or generate 85.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Financial 7 vs. JNK Heaters Co
Performance |
| Timeline |
| Hana Financial 7 |
| JNK Heaters |
Hana Financial and JNK Heaters Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Financial and JNK Heaters
The main advantage of trading using opposite Hana Financial and JNK Heaters positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Financial position performs unexpectedly, JNK Heaters 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 JNK Heaters will offset losses from the drop in JNK Heaters' long position.| Hana Financial vs. Ananti Inc | Hana Financial vs. SS TECH | Hana Financial vs. Vieworks Co | Hana Financial vs. Shinsung Delta Tech |
| JNK Heaters vs. CJ Seafood Corp | JNK Heaters vs. Samlip General Foods | JNK Heaters vs. Haitai Confectionery Foods | JNK Heaters vs. Jeju Bank |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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