Correlation Between Hankook Steel and Cube Entertainment
Can any of the company-specific risk be diversified away by investing in both Hankook Steel and Cube Entertainment 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 Hankook Steel and Cube Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hankook Steel Co and Cube Entertainment, you can compare the effects of market volatilities on Hankook Steel and Cube Entertainment 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 Hankook Steel with a short position of Cube Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hankook Steel and Cube Entertainment.
Diversification Opportunities for Hankook Steel and Cube Entertainment
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hankook and Cube is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Hankook Steel Co and Cube Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cube Entertainment and Hankook Steel 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 Hankook Steel Co are associated (or correlated) with Cube Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cube Entertainment has no effect on the direction of Hankook Steel i.e., Hankook Steel and Cube Entertainment go up and down completely randomly.
Pair Corralation between Hankook Steel and Cube Entertainment
Assuming the 90 days trading horizon Hankook Steel is expected to generate 2.81 times less return on investment than Cube Entertainment. In addition to that, Hankook Steel is 1.27 times more volatile than Cube Entertainment. It trades about 0.02 of its total potential returns per unit of risk. Cube Entertainment is currently generating about 0.06 per unit of volatility. If you would invest 1,462,000 in Cube Entertainment on September 25, 2024 and sell it today you would earn a total of 136,000 from holding Cube Entertainment or generate 9.3% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 98.39% |
Values | Daily Returns |
Hankook Steel Co vs. Cube Entertainment
Performance |
Timeline |
Hankook Steel |
Cube Entertainment |
Hankook Steel and Cube Entertainment Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hankook Steel and Cube Entertainment
The main advantage of trading using opposite Hankook Steel and Cube Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hankook Steel position performs unexpectedly, Cube Entertainment 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 Cube Entertainment will offset losses from the drop in Cube Entertainment's long position.Hankook Steel vs. AptaBio Therapeutics | Hankook Steel vs. Wonbang Tech Co | Hankook Steel vs. Busan Industrial Co | Hankook Steel vs. Busan Ind |
Cube Entertainment vs. Han Kook Steel | Cube Entertainment vs. TK Chemical | Cube Entertainment vs. Hankook Steel Co | Cube Entertainment vs. Bookook Steel |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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