Correlation Between Jeju Beer and HJ ShipBuilding
Can any of the company-specific risk be diversified away by investing in both Jeju Beer and HJ ShipBuilding 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 Jeju Beer and HJ ShipBuilding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeju Beer Co and HJ ShipBuilding Construction, you can compare the effects of market volatilities on Jeju Beer and HJ ShipBuilding 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 Jeju Beer with a short position of HJ ShipBuilding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeju Beer and HJ ShipBuilding.
Diversification Opportunities for Jeju Beer and HJ ShipBuilding
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jeju and 097230 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Jeju Beer Co and HJ ShipBuilding Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HJ ShipBuilding Cons and Jeju Beer 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 Jeju Beer Co are associated (or correlated) with HJ ShipBuilding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HJ ShipBuilding Cons has no effect on the direction of Jeju Beer i.e., Jeju Beer and HJ ShipBuilding go up and down completely randomly.
Pair Corralation between Jeju Beer and HJ ShipBuilding
Assuming the 90 days trading horizon Jeju Beer Co is expected to under-perform the HJ ShipBuilding. In addition to that, Jeju Beer is 1.47 times more volatile than HJ ShipBuilding Construction. It trades about -0.02 of its total potential returns per unit of risk. HJ ShipBuilding Construction is currently generating about 0.01 per unit of volatility. If you would invest 396,000 in HJ ShipBuilding Construction on September 13, 2024 and sell it today you would lose (13,500) from holding HJ ShipBuilding Construction or give up 3.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeju Beer Co vs. HJ ShipBuilding Construction
Performance |
| Timeline |
| Jeju Beer |
| HJ ShipBuilding Cons |
Jeju Beer and HJ ShipBuilding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeju Beer and HJ ShipBuilding
The main advantage of trading using opposite Jeju Beer and HJ ShipBuilding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeju Beer position performs unexpectedly, HJ ShipBuilding 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 HJ ShipBuilding will offset losses from the drop in HJ ShipBuilding's long position.| Jeju Beer vs. AptaBio Therapeutics | Jeju Beer vs. Daewoo SBI SPAC | Jeju Beer vs. Dream Security co | Jeju Beer vs. Microfriend |
| HJ ShipBuilding vs. Kisan Telecom Co | HJ ShipBuilding vs. Korean Drug Co | HJ ShipBuilding vs. CJ Seafood Corp | HJ ShipBuilding vs. Sejong Telecom |
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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