Correlation Between Quality Houses and Hana Microelectronics
Can any of the company-specific risk be diversified away by investing in both Quality Houses 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 Quality Houses and Hana Microelectronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quality Houses Public and Hana Microelectronics Public, you can compare the effects of market volatilities on Quality Houses 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 Quality Houses with a short position of Hana Microelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quality Houses and Hana Microelectronics.
Diversification Opportunities for Quality Houses and Hana Microelectronics
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Quality and Hana is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Quality Houses Public and Hana Microelectronics Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Microelectronics and Quality Houses 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 Quality Houses Public 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 Quality Houses i.e., Quality Houses and Hana Microelectronics go up and down completely randomly.
Pair Corralation between Quality Houses and Hana Microelectronics
Assuming the 90 days horizon Quality Houses Public is expected to generate 0.27 times more return on investment than Hana Microelectronics. However, Quality Houses Public is 3.7 times less risky than Hana Microelectronics. It trades about -0.15 of its potential returns per unit of risk. Hana Microelectronics Public is currently generating about -0.41 per unit of risk. If you would invest 186.00 in Quality Houses Public on September 1, 2024 and sell it today you would lose (6.00) from holding Quality Houses Public or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quality Houses Public vs. Hana Microelectronics Public
Performance |
| Timeline |
| Quality Houses Public |
| Hana Microelectronics |
Quality Houses and Hana Microelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quality Houses and Hana Microelectronics
The main advantage of trading using opposite Quality Houses and Hana Microelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quality Houses 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.| Quality Houses vs. Land and Houses | Quality Houses vs. Bangkok Bank Public | Quality Houses vs. Charoen Pokphand Foods |
| Hana Microelectronics vs. AP Public | Hana Microelectronics vs. Jasmine International Public | Hana Microelectronics vs. Asia Plus Group | Hana Microelectronics 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |