Correlation Between Cuckoo Electronics and Hanjin Transportation
Can any of the company-specific risk be diversified away by investing in both Cuckoo Electronics and Hanjin Transportation 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 Cuckoo Electronics and Hanjin Transportation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cuckoo Electronics Co and Hanjin Transportation Co, you can compare the effects of market volatilities on Cuckoo Electronics and Hanjin Transportation 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 Cuckoo Electronics with a short position of Hanjin Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cuckoo Electronics and Hanjin Transportation.
Diversification Opportunities for Cuckoo Electronics and Hanjin Transportation
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Cuckoo and Hanjin is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Cuckoo Electronics Co and Hanjin Transportation Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanjin Transportation and Cuckoo 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 Cuckoo Electronics Co are associated (or correlated) with Hanjin Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanjin Transportation has no effect on the direction of Cuckoo Electronics i.e., Cuckoo Electronics and Hanjin Transportation go up and down completely randomly.
Pair Corralation between Cuckoo Electronics and Hanjin Transportation
Assuming the 90 days trading horizon Cuckoo Electronics Co is expected to generate 1.04 times more return on investment than Hanjin Transportation. However, Cuckoo Electronics is 1.04 times more volatile than Hanjin Transportation Co. It trades about 0.06 of its potential returns per unit of risk. Hanjin Transportation Co is currently generating about 0.0 per unit of risk. If you would invest 1,486,631 in Cuckoo Electronics Co on September 30, 2024 and sell it today you would earn a total of 828,369 from holding Cuckoo Electronics Co or generate 55.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Cuckoo Electronics Co vs. Hanjin Transportation Co
Performance |
Timeline |
Cuckoo Electronics |
Hanjin Transportation |
Cuckoo Electronics and Hanjin Transportation Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cuckoo Electronics and Hanjin Transportation
The main advantage of trading using opposite Cuckoo Electronics and Hanjin Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cuckoo Electronics position performs unexpectedly, Hanjin Transportation 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 Hanjin Transportation will offset losses from the drop in Hanjin Transportation's long position.Cuckoo Electronics vs. Woori Technology Investment | Cuckoo Electronics vs. Samsung Card Co | Cuckoo Electronics vs. Korea Real Estate | Cuckoo Electronics vs. CHOROKBAEM PANY Co |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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