Correlation Between Haesung Industrial and Osteonic

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

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

Diversification Opportunities for Haesung Industrial and Osteonic

0.54

Correlation Coefficient

Haesung Industrial  Osteonic

Very weak diversification

The 3 months correlation between Haesung and Osteonic is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Haesung Industrial Co and Osteonic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Osteonic and Haesung Industrial 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 Haesung Industrial Co are associated (or correlated) with Osteonic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Osteonic has no effect on the direction of Haesung Industrial i.e., Haesung Industrial and Osteonic go up and down completely randomly.

Pair Corralation between Haesung Industrial and Osteonic

Assuming the 90 days trading horizon Haesung Industrial is expected to generate 4.28 times less return on investment than Osteonic. But when comparing it to its historical volatility, Haesung Industrial Co is 2.25 times less risky than Osteonic. It trades about 0.1 of its potential returns per unit of risk. Osteonic Co is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  512,000  in Osteonic Co on December 2, 2024 and sell it today you would earn a total of  244,000  from holding Osteonic Co or generate 47.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Haesung Industrial Co  vs.  Osteonic Co

Haesung Industrial

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Haesung Industrial Co are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Haesung Industrial may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Osteonic

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Osteonic Co are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Osteonic sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Haesung Industrial and Osteonic

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

The idea behind Haesung Industrial Co and Osteonic 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.