Correlation Between Hanmi Financial and Alpha Partners

Can any of the company-specific risk be diversified away by investing in both Hanmi Financial and Alpha Partners 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 Hanmi Financial and Alpha Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hanmi Financial and Alpha Partners Technology, you can compare the effects of market volatilities on Hanmi Financial and Alpha Partners 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 Hanmi Financial with a short position of Alpha Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanmi Financial and Alpha Partners.

Diversification Opportunities for Hanmi Financial and Alpha Partners

-0.69

Correlation Coefficient

Hanmi Financial  Alpha Partners

Excellent diversification

The 3 months correlation between Hanmi and Alpha is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Hanmi Financial and Alpha Partners Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha Partners Technology and Hanmi Financial 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 Hanmi Financial are associated (or correlated) with Alpha Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha Partners Technology has no effect on the direction of Hanmi Financial i.e., Hanmi Financial and Alpha Partners go up and down completely randomly.

Pair Corralation between Hanmi Financial and Alpha Partners

If you would invest  1,898  in Hanmi Financial on September 22, 2024 and sell it today you would earn a total of  439.00  from holding Hanmi Financial or generate 23.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.56%
Values	Daily Returns

Hanmi Financial  vs.  Alpha Partners Technology

Hanmi Financial

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hanmi Financial are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting technical and fundamental indicators, Hanmi Financial exhibited solid returns over the last few months and may actually be approaching a breakup point.

Alpha Partners Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Alpha Partners Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable primary indicators, Alpha Partners is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Hanmi Financial and Alpha Partners

The main advantage of trading using opposite Hanmi Financial and Alpha Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanmi Financial position performs unexpectedly, Alpha Partners 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 Alpha Partners will offset losses from the drop in Alpha Partners' long position.

The idea behind Hanmi Financial and Alpha Partners Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.