Correlation Between SK Hynix and Young Poong
Can any of the company-specific risk be diversified away by investing in both SK Hynix and Young Poong 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 SK Hynix and Young Poong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Hynix and Young Poong Corp, you can compare the effects of market volatilities on SK Hynix and Young Poong 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 SK Hynix with a short position of Young Poong. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Hynix and Young Poong.
Diversification Opportunities for SK Hynix and Young Poong
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 000660 and Young is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding SK Hynix and Young Poong Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Young Poong Corp and SK Hynix 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 SK Hynix are associated (or correlated) with Young Poong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Young Poong Corp has no effect on the direction of SK Hynix i.e., SK Hynix and Young Poong go up and down completely randomly.
Pair Corralation between SK Hynix and Young Poong
Assuming the 90 days trading horizon SK Hynix is expected to generate 2.4 times more return on investment than Young Poong. However, SK Hynix is 2.4 times more volatile than Young Poong Corp. It trades about 0.24 of its potential returns per unit of risk. Young Poong Corp is currently generating about 0.06 per unit of risk. If you would invest 17,550,000 in SK Hynix on October 14, 2024 and sell it today you would earn a total of 2,800,000 from holding SK Hynix or generate 15.95% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
SK Hynix vs. Young Poong Corp
Performance |
Timeline |
SK Hynix |
Young Poong Corp |
SK Hynix and Young Poong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SK Hynix and Young Poong
The main advantage of trading using opposite SK Hynix and Young Poong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Hynix position performs unexpectedly, Young Poong 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 Young Poong will offset losses from the drop in Young Poong's long position.SK Hynix vs. Atinum Investment Co | SK Hynix vs. Sangsangin Investment Securities | SK Hynix vs. Samyung Trading Co | SK Hynix vs. DB Financial Investment |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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