Correlation Between Hana Microelectronics and Delta Electronics
Can any of the company-specific risk be diversified away by investing in both Hana Microelectronics and Delta Electronics 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 Hana Microelectronics and Delta Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hana Microelectronics Public and Delta Electronics Public, you can compare the effects of market volatilities on Hana Microelectronics and Delta Electronics 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 Hana Microelectronics with a short position of Delta Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hana Microelectronics and Delta Electronics.
Diversification Opportunities for Hana Microelectronics and Delta Electronics
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hana and Delta is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Hana Microelectronics Public and Delta Electronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Electronics Public and Hana Microelectronics 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 Hana Microelectronics Public are associated (or correlated) with Delta Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Electronics Public has no effect on the direction of Hana Microelectronics i.e., Hana Microelectronics and Delta Electronics go up and down completely randomly.
Pair Corralation between Hana Microelectronics and Delta Electronics
Assuming the 90 days trading horizon Hana Microelectronics Public is expected to under-perform the Delta Electronics. But the stock apears to be less risky and, when comparing its historical volatility, Hana Microelectronics Public is 1.09 times less risky than Delta Electronics. The stock trades about -0.03 of its potential returns per unit of risk. The Delta Electronics Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 10,282 in Delta Electronics Public on August 31, 2024 and sell it today you would earn a total of 4,768 from holding Delta Electronics Public or generate 46.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hana Microelectronics Public vs. Delta Electronics Public
Performance |
| Timeline |
| Hana Microelectronics |
| Delta Electronics Public |
Hana Microelectronics and Delta Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hana Microelectronics and Delta Electronics
The main advantage of trading using opposite Hana Microelectronics and Delta Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hana Microelectronics position performs unexpectedly, Delta Electronics 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 Delta Electronics will offset losses from the drop in Delta Electronics' long position.| Hana Microelectronics vs. AP Public | Hana Microelectronics vs. Jasmine International Public | Hana Microelectronics vs. Asia Plus Group | Hana Microelectronics vs. Bangchak Public |
| Delta Electronics vs. AP Public | Delta Electronics vs. Jasmine International Public | Delta Electronics vs. Asia Plus Group | Delta Electronics vs. Bangchak Public |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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