Correlation Between Shinhan WTI and Hanwha Galleria
Can any of the company-specific risk be diversified away by investing in both Shinhan WTI and Hanwha Galleria 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 WTI and Hanwha Galleria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinhan WTI Futures and Hanwha Galleria Corp, you can compare the effects of market volatilities on Shinhan WTI and Hanwha Galleria 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 WTI with a short position of Hanwha Galleria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinhan WTI and Hanwha Galleria.
Diversification Opportunities for Shinhan WTI and Hanwha Galleria
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shinhan and Hanwha is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Shinhan WTI Futures and Hanwha Galleria Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanwha Galleria Corp and Shinhan WTI 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 WTI Futures are associated (or correlated) with Hanwha Galleria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanwha Galleria Corp has no effect on the direction of Shinhan WTI i.e., Shinhan WTI and Hanwha Galleria go up and down completely randomly.
Pair Corralation between Shinhan WTI and Hanwha Galleria
Assuming the 90 days trading horizon Shinhan WTI Futures is expected to under-perform the Hanwha Galleria. In addition to that, Shinhan WTI is 2.87 times more volatile than Hanwha Galleria Corp. It trades about -0.01 of its total potential returns per unit of risk. Hanwha Galleria Corp is currently generating about 0.13 per unit of volatility. If you would invest 1,140,848 in Hanwha Galleria Corp on September 2, 2024 and sell it today you would earn a total of 61,152 from holding Hanwha Galleria Corp or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 96.67% |
| Values | Daily Returns |
Shinhan WTI Futures vs. Hanwha Galleria Corp
Performance |
| Timeline |
| Shinhan WTI Futures |
| Hanwha Galleria Corp |
Shinhan WTI and Hanwha Galleria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinhan WTI and Hanwha Galleria
The main advantage of trading using opposite Shinhan WTI and Hanwha Galleria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinhan WTI position performs unexpectedly, Hanwha Galleria 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 Hanwha Galleria will offset losses from the drop in Hanwha Galleria's long position.| Shinhan WTI vs. BNK Financial Group | Shinhan WTI vs. Dongbu Insurance Co | Shinhan WTI vs. KakaoBank Corp | Shinhan WTI vs. Korea Alcohol Industrial |
| Hanwha Galleria vs. Hanwha ARIRANG KTB | Hanwha Galleria vs. Hanwha ARIRANG KOSPI50 | Hanwha Galleria vs. Hanwha ARIRANG SP |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |