Correlation Between SK Hynix and IQuest
Can any of the company-specific risk be diversified away by investing in both SK Hynix and IQuest 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 IQuest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Hynix and IQuest Co, you can compare the effects of market volatilities on SK Hynix and IQuest 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 IQuest. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Hynix and IQuest.
Diversification Opportunities for SK Hynix and IQuest
Average diversification
The 3 months correlation between 000660 and IQuest is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding SK Hynix and IQuest Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IQuest 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 IQuest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IQuest has no effect on the direction of SK Hynix i.e., SK Hynix and IQuest go up and down completely randomly.
Pair Corralation between SK Hynix and IQuest
Assuming the 90 days trading horizon SK Hynix is expected to generate 1.02 times more return on investment than IQuest. However, SK Hynix is 1.02 times more volatile than IQuest Co. It trades about 0.05 of its potential returns per unit of risk. IQuest Co is currently generating about 0.0 per unit of risk. If you would invest 13,300,400 in SK Hynix on August 26, 2024 and sell it today you would earn a total of 4,369,600 from holding SK Hynix or generate 32.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Hynix vs. IQuest Co
Performance |
| Timeline |
| SK Hynix |
| IQuest |
SK Hynix and IQuest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Hynix and IQuest
The main advantage of trading using opposite SK Hynix and IQuest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Hynix position performs unexpectedly, IQuest 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 IQuest will offset losses from the drop in IQuest's long position.| SK Hynix vs. Hyundai Home Shopping | SK Hynix vs. Hankook Furniture Co | SK Hynix vs. Jin Air Co | SK Hynix vs. JC Chemical Co |
| IQuest vs. Samsung Electronics Co | IQuest vs. Samsung Electronics Co | IQuest vs. LG Energy Solution | IQuest vs. SK Hynix |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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