Correlation Between NAU IB and HB Technology
Can any of the company-specific risk be diversified away by investing in both NAU IB and HB Technology 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 NAU IB and HB Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAU IB Capital and HB Technology TD, you can compare the effects of market volatilities on NAU IB and HB Technology 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 NAU IB with a short position of HB Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAU IB and HB Technology.
Diversification Opportunities for NAU IB and HB Technology
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between NAU and 078150 is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding NAU IB Capital and HB Technology TD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HB Technology TD and NAU IB 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 NAU IB Capital are associated (or correlated) with HB Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HB Technology TD has no effect on the direction of NAU IB i.e., NAU IB and HB Technology go up and down completely randomly.
Pair Corralation between NAU IB and HB Technology
Assuming the 90 days trading horizon NAU IB Capital is expected to under-perform the HB Technology. But the stock apears to be less risky and, when comparing its historical volatility, NAU IB Capital is 1.54 times less risky than HB Technology. The stock trades about -0.37 of its potential returns per unit of risk. The HB Technology TD is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 199,400 in HB Technology TD on November 3, 2024 and sell it today you would earn a total of 44,600 from holding HB Technology TD or generate 22.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NAU IB Capital vs. HB Technology TD
Performance |
| Timeline |
| NAU IB Capital |
| HB Technology TD |
NAU IB and HB Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAU IB and HB Technology
The main advantage of trading using opposite NAU IB and HB Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAU IB position performs unexpectedly, HB Technology 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 HB Technology will offset losses from the drop in HB Technology's long position.| NAU IB vs. Pureun Mutual Savings | NAU IB vs. Jb Financial | NAU IB vs. Jeong Moon Information | NAU IB vs. Korea Information Engineering |
| HB Technology vs. Kukil Metal Co | HB Technology vs. National Plastic Co | HB Technology vs. Daejung Chemicals Metals | HB Technology vs. WONIK Materials CoLtd |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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