Correlation Between NH Investment and Hankukpackage

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

By analyzing existing cross correlation between NH Investment Securities and Hankukpackage Co, you can compare the effects of market volatilities on NH Investment and Hankukpackage 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 NH Investment with a short position of Hankukpackage. Check out your portfolio center. Please also check ongoing floating volatility patterns of NH Investment and Hankukpackage.

Diversification Opportunities for NH Investment and Hankukpackage

-0.8

Correlation Coefficient

NH Investment  Hankukpackage

Pay attention - limited upside

The 3 months correlation between 005940 and Hankukpackage is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding NH Investment Securities and Hankukpackage Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hankukpackage and NH Investment 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 NH Investment Securities are associated (or correlated) with Hankukpackage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hankukpackage has no effect on the direction of NH Investment i.e., NH Investment and Hankukpackage go up and down completely randomly.

Pair Corralation between NH Investment and Hankukpackage

Assuming the 90 days trading horizon NH Investment Securities is expected to generate 1.43 times more return on investment than Hankukpackage. However, NH Investment is 1.43 times more volatile than Hankukpackage Co. It trades about 0.08 of its potential returns per unit of risk. Hankukpackage Co is currently generating about -0.05 per unit of risk. If you would invest  1,414,000  in NH Investment Securities on December 26, 2024 and sell it today you would earn a total of  79,000  from holding NH Investment Securities or generate 5.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.28%
Values	Daily Returns

NH Investment Securities  vs.  Hankukpackage Co

NH Investment Securities

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in NH Investment Securities are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, NH Investment may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Hankukpackage

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hankukpackage Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Hankukpackage is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with NH Investment and Hankukpackage

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

The idea behind NH Investment Securities and Hankukpackage Co 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.