Correlation Between Hanmi Semiconductor and Ilji Technology

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

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

Diversification Opportunities for Hanmi Semiconductor and Ilji Technology

0.39

Correlation Coefficient

Hanmi Semiconductor  Ilji Technology

Weak diversification

The 3 months correlation between Hanmi and Ilji is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hanmi Semiconductor Co and Ilji Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ilji Technology and Hanmi Semiconductor 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 Semiconductor Co are associated (or correlated) with Ilji Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ilji Technology has no effect on the direction of Hanmi Semiconductor i.e., Hanmi Semiconductor and Ilji Technology go up and down completely randomly.

Pair Corralation between Hanmi Semiconductor and Ilji Technology

Assuming the 90 days trading horizon Hanmi Semiconductor Co is expected to generate 1.81 times more return on investment than Ilji Technology. However, Hanmi Semiconductor is 1.81 times more volatile than Ilji Technology Co. It trades about 0.04 of its potential returns per unit of risk. Ilji Technology Co is currently generating about 0.03 per unit of risk. If you would invest  8,601,402  in Hanmi Semiconductor Co on December 22, 2024 and sell it today you would earn a total of  428,598  from holding Hanmi Semiconductor Co or generate 4.98% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.28%
Values	Daily Returns

Hanmi Semiconductor Co  vs.  Ilji Technology Co

Hanmi Semiconductor

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Hanmi Semiconductor Co are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Hanmi Semiconductor may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Ilji Technology

Risk-Adjusted Performance

Weak

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

Pair Trading with Hanmi Semiconductor and Ilji Technology

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

The idea behind Hanmi Semiconductor Co and Ilji Technology 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.