Correlation Between Woori Financial and Hannong Chemicals
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Hannong Chemicals 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 Woori Financial and Hannong Chemicals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Hannong Chemicals, you can compare the effects of market volatilities on Woori Financial and Hannong Chemicals 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 Woori Financial with a short position of Hannong Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Hannong Chemicals.
Diversification Opportunities for Woori Financial and Hannong Chemicals
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Woori and Hannong is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Hannong Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hannong Chemicals and Woori 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 Woori Financial Group are associated (or correlated) with Hannong Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hannong Chemicals has no effect on the direction of Woori Financial i.e., Woori Financial and Hannong Chemicals go up and down completely randomly.
Pair Corralation between Woori Financial and Hannong Chemicals
Assuming the 90 days trading horizon Woori Financial Group is expected to generate 0.43 times more return on investment than Hannong Chemicals. However, Woori Financial Group is 2.32 times less risky than Hannong Chemicals. It trades about -0.1 of its potential returns per unit of risk. Hannong Chemicals is currently generating about -0.06 per unit of risk. If you would invest 1,685,000 in Woori Financial Group on October 26, 2024 and sell it today you would lose (109,000) from holding Woori Financial Group or give up 6.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Hannong Chemicals
Performance |
| Timeline |
| Woori Financial Group |
| Hannong Chemicals |
Woori Financial and Hannong Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Hannong Chemicals
The main advantage of trading using opposite Woori Financial and Hannong Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Hannong Chemicals 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 Hannong Chemicals will offset losses from the drop in Hannong Chemicals' long position.| Woori Financial vs. BIT Computer Co | Woori Financial vs. Hyundai Industrial Co | Woori Financial vs. Industrial Bank | Woori Financial vs. Hyunwoo Industrial Co |
| Hannong Chemicals vs. KB Financial Group | Hannong Chemicals vs. Shinhan Financial Group | Hannong Chemicals vs. Hana Financial | Hannong Chemicals vs. Woori Financial Group |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |