Correlation Between Seohee Construction and Han Kook

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Can any of the company-specific risk be diversified away by investing in both Seohee Construction and Han Kook 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 Seohee Construction and Han Kook into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seohee Construction Co and Han Kook Capital, you can compare the effects of market volatilities on Seohee Construction and Han Kook 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 Seohee Construction with a short position of Han Kook. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seohee Construction and Han Kook.

Diversification Opportunities for Seohee Construction and Han Kook

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Seohee and Han is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Seohee Construction Co and Han Kook Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Han Kook Capital and Seohee Construction 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 Seohee Construction Co are associated (or correlated) with Han Kook. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Han Kook Capital has no effect on the direction of Seohee Construction i.e., Seohee Construction and Han Kook go up and down completely randomly.

Pair Corralation between Seohee Construction and Han Kook

If you would invest  153,200  in Seohee Construction Co on October 10, 2024 and sell it today you would earn a total of  9,600  from holding Seohee Construction Co or generate 6.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy5.26%
ValuesDaily Returns

Seohee Construction Co  vs.  Han Kook Capital

 Performance 
       Timeline  
Seohee Construction 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Seohee Construction Co are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Seohee Construction is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Han Kook Capital 

Risk-Adjusted Performance

0 of 100

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

Seohee Construction and Han Kook Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Seohee Construction and Han Kook

The main advantage of trading using opposite Seohee Construction and Han Kook positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seohee Construction position performs unexpectedly, Han Kook 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 Han Kook will offset losses from the drop in Han Kook's long position.
The idea behind Seohee Construction Co and Han Kook Capital 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.
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.

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