Correlation Between Shinhan Inverse and Heungkuk Metaltech
Can any of the company-specific risk be diversified away by investing in both Shinhan Inverse and Heungkuk Metaltech 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 Shinhan Inverse and Heungkuk Metaltech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan Inverse Silver and Heungkuk Metaltech CoLtd, you can compare the effects of market volatilities on Shinhan Inverse and Heungkuk Metaltech 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 Shinhan Inverse with a short position of Heungkuk Metaltech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan Inverse and Heungkuk Metaltech.
Diversification Opportunities for Shinhan Inverse and Heungkuk Metaltech
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shinhan and Heungkuk is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan Inverse Silver and Heungkuk Metaltech CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heungkuk Metaltech CoLtd and Shinhan Inverse 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 Shinhan Inverse Silver are associated (or correlated) with Heungkuk Metaltech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heungkuk Metaltech CoLtd has no effect on the direction of Shinhan Inverse i.e., Shinhan Inverse and Heungkuk Metaltech go up and down completely randomly.
Pair Corralation between Shinhan Inverse and Heungkuk Metaltech
Assuming the 90 days trading horizon Shinhan Inverse Silver is expected to under-perform the Heungkuk Metaltech. But the stock apears to be less risky and, when comparing its historical volatility, Shinhan Inverse Silver is 1.17 times less risky than Heungkuk Metaltech. The stock trades about -0.22 of its potential returns per unit of risk. The Heungkuk Metaltech CoLtd is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 497,309 in Heungkuk Metaltech CoLtd on October 21, 2024 and sell it today you would earn a total of 24,691 from holding Heungkuk Metaltech CoLtd or generate 4.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinhan Inverse Silver vs. Heungkuk Metaltech CoLtd
Performance |
| Timeline |
| Shinhan Inverse Silver |
| Heungkuk Metaltech CoLtd |
Shinhan Inverse and Heungkuk Metaltech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan Inverse and Heungkuk Metaltech
The main advantage of trading using opposite Shinhan Inverse and Heungkuk Metaltech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan Inverse position performs unexpectedly, Heungkuk Metaltech 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 Heungkuk Metaltech will offset losses from the drop in Heungkuk Metaltech's long position.| Shinhan Inverse vs. Hanjin Transportation Co | Shinhan Inverse vs. Korea Shipbuilding Offshore | Shinhan Inverse vs. Eagon Industrial Co | Shinhan Inverse vs. Hwasung Industrial Co |
| Heungkuk Metaltech vs. Keyang Electric Machinery | Heungkuk Metaltech vs. Dongkuk Structures Construction | Heungkuk Metaltech vs. Nable Communications | Heungkuk Metaltech vs. PlayD Co |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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