Correlation Between Benchmark Electronics and Hana Microelectronics
Can any of the company-specific risk be diversified away by investing in both Benchmark Electronics and Hana Microelectronics 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 Benchmark Electronics and Hana Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benchmark Electronics and Hana Microelectronics Public, you can compare the effects of market volatilities on Benchmark Electronics and Hana Microelectronics 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 Benchmark Electronics with a short position of Hana Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benchmark Electronics and Hana Microelectronics.
Diversification Opportunities for Benchmark Electronics and Hana Microelectronics
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Benchmark and Hana is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Benchmark Electronics and Hana Microelectronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Microelectronics and Benchmark Electronics 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 Benchmark Electronics are associated (or correlated) with Hana Microelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Microelectronics has no effect on the direction of Benchmark Electronics i.e., Benchmark Electronics and Hana Microelectronics go up and down completely randomly.
Pair Corralation between Benchmark Electronics and Hana Microelectronics
Assuming the 90 days horizon Benchmark Electronics is expected to under-perform the Hana Microelectronics. But the stock apears to be less risky and, when comparing its historical volatility, Benchmark Electronics is 6.95 times less risky than Hana Microelectronics. The stock trades about -0.23 of its potential returns per unit of risk. The Hana Microelectronics Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 64.00 in Hana Microelectronics Public on September 12, 2024 and sell it today you would earn a total of 7.00 from holding Hana Microelectronics Public or generate 10.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Benchmark Electronics vs. Hana Microelectronics Public
Performance |
| Timeline |
| Benchmark Electronics |
| Hana Microelectronics |
Benchmark Electronics and Hana Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benchmark Electronics and Hana Microelectronics
The main advantage of trading using opposite Benchmark Electronics and Hana Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benchmark Electronics position performs unexpectedly, Hana Microelectronics 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 Hana Microelectronics will offset losses from the drop in Hana Microelectronics' long position.| Benchmark Electronics vs. Meiko Electronics Co | Benchmark Electronics vs. Superior Plus Corp | Benchmark Electronics vs. SIVERS SEMICONDUCTORS AB | Benchmark Electronics vs. Norsk Hydro ASA |
| Hana Microelectronics vs. Benchmark Electronics | Hana Microelectronics vs. Meiko Electronics Co | Hana Microelectronics vs. Superior Plus Corp | Hana Microelectronics vs. SIVERS SEMICONDUCTORS AB |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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