Correlation Between Hana Financial and KNOTUS CoLtd
Can any of the company-specific risk be diversified away by investing in both Hana Financial and KNOTUS CoLtd 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 KNOTUS CoLtd 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 KNOTUS CoLtd, you can compare the effects of market volatilities on Hana Financial and KNOTUS CoLtd 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 KNOTUS CoLtd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Financial and KNOTUS CoLtd.
Diversification Opportunities for Hana Financial and KNOTUS CoLtd
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hana and KNOTUS is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Hana Financial 7 and KNOTUS CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KNOTUS CoLtd 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 KNOTUS CoLtd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KNOTUS CoLtd has no effect on the direction of Hana Financial i.e., Hana Financial and KNOTUS CoLtd go up and down completely randomly.
Pair Corralation between Hana Financial and KNOTUS CoLtd
Assuming the 90 days trading horizon Hana Financial 7 is expected to under-perform the KNOTUS CoLtd. But the stock apears to be less risky and, when comparing its historical volatility, Hana Financial 7 is 1.33 times less risky than KNOTUS CoLtd. The stock trades about -0.04 of its potential returns per unit of risk. The KNOTUS CoLtd is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 271,000 in KNOTUS CoLtd on September 4, 2024 and sell it today you would lose (68,500) from holding KNOTUS CoLtd or give up 25.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Financial 7 vs. KNOTUS CoLtd
Performance |
| Timeline |
| Hana Financial 7 |
| KNOTUS CoLtd |
Hana Financial and KNOTUS CoLtd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Financial and KNOTUS CoLtd
The main advantage of trading using opposite Hana Financial and KNOTUS CoLtd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Financial position performs unexpectedly, KNOTUS CoLtd 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 KNOTUS CoLtd will offset losses from the drop in KNOTUS CoLtd's long position.| Hana Financial vs. Ananti Inc | Hana Financial vs. SS TECH | Hana Financial vs. Vieworks Co | Hana Financial vs. Shinsung Delta Tech |
| KNOTUS CoLtd vs. Bridge Biotherapeutics | KNOTUS CoLtd vs. AptaBio Therapeutics | KNOTUS CoLtd vs. Cytogen | KNOTUS CoLtd vs. Genolution |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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