Correlation Between Hanjoo Light and Tae Kyung

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Hanjoo Light and Tae Kyung 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 Hanjoo Light and Tae Kyung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanjoo Light Metal and Tae Kyung Chemical, you can compare the effects of market volatilities on Hanjoo Light and Tae Kyung 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 Hanjoo Light with a short position of Tae Kyung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjoo Light and Tae Kyung.

Diversification Opportunities for Hanjoo Light and Tae Kyung

HanjooTaeDiversified AwayHanjooTaeDiversified Away100%
-0.22
  Correlation Coefficient

Very good diversification

The 3 months correlation between Hanjoo and Tae is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Hanjoo Light Metal and Tae Kyung Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tae Kyung Chemical and Hanjoo Light 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 Hanjoo Light Metal are associated (or correlated) with Tae Kyung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tae Kyung Chemical has no effect on the direction of Hanjoo Light i.e., Hanjoo Light and Tae Kyung go up and down completely randomly.

Pair Corralation between Hanjoo Light and Tae Kyung

Assuming the 90 days trading horizon Hanjoo Light Metal is expected to under-perform the Tae Kyung. In addition to that, Hanjoo Light is 1.29 times more volatile than Tae Kyung Chemical. It trades about -0.13 of its total potential returns per unit of risk. Tae Kyung Chemical is currently generating about 0.06 per unit of volatility. If you would invest  1,065,847  in Tae Kyung Chemical on October 31, 2024 and sell it today you would earn a total of  59,153  from holding Tae Kyung Chemical or generate 5.55% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Hanjoo Light Metal  vs.  Tae Kyung Chemical

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -25-20-15-10-505
JavaScript chart by amCharts 3.21.15198940 006890
       Timeline  
Hanjoo Light Metal 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Hanjoo Light Metal has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the company investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan7007508008509009501,000
Tae Kyung Chemical 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Tae Kyung Chemical are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Tae Kyung may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan9,50010,00010,50011,00011,500

Hanjoo Light and Tae Kyung Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.71-2.78-1.85-0.91-0.01370.791.622.443.264.08 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15198940 006890
       Returns  

Pair Trading with Hanjoo Light and Tae Kyung

The main advantage of trading using opposite Hanjoo Light and Tae Kyung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjoo Light position performs unexpectedly, Tae Kyung 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 Tae Kyung will offset losses from the drop in Tae Kyung's long position.
The idea behind Hanjoo Light Metal and Tae Kyung Chemical 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.

Other Complementary Tools

ETFs
Find actively traded Exchange Traded Funds (ETF) from around the world
Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Transaction History
View history of all your transactions and understand their impact on performance
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance