Correlation Between Sangsangin Investment and Hyundai Engineering
Can any of the company-specific risk be diversified away by investing in both Sangsangin Investment and Hyundai Engineering 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 Sangsangin Investment and Hyundai Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sangsangin Investment Securities and Hyundai Engineering Plastics, you can compare the effects of market volatilities on Sangsangin Investment and Hyundai Engineering 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 Sangsangin Investment with a short position of Hyundai Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sangsangin Investment and Hyundai Engineering.
Diversification Opportunities for Sangsangin Investment and Hyundai Engineering
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sangsangin and Hyundai is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Sangsangin Investment Securiti and Hyundai Engineering Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Engineering and Sangsangin Investment 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 Sangsangin Investment Securities are associated (or correlated) with Hyundai Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Engineering has no effect on the direction of Sangsangin Investment i.e., Sangsangin Investment and Hyundai Engineering go up and down completely randomly.
Pair Corralation between Sangsangin Investment and Hyundai Engineering
Assuming the 90 days trading horizon Sangsangin Investment Securities is expected to under-perform the Hyundai Engineering. In addition to that, Sangsangin Investment is 1.09 times more volatile than Hyundai Engineering Plastics. It trades about -0.05 of its total potential returns per unit of risk. Hyundai Engineering Plastics is currently generating about 0.0 per unit of volatility. If you would invest 379,328 in Hyundai Engineering Plastics on September 21, 2024 and sell it today you would lose (24,328) from holding Hyundai Engineering Plastics or give up 6.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sangsangin Investment Securiti vs. Hyundai Engineering Plastics
Performance |
| Timeline |
| Sangsangin Investment |
| Hyundai Engineering |
Sangsangin Investment and Hyundai Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sangsangin Investment and Hyundai Engineering
The main advantage of trading using opposite Sangsangin Investment and Hyundai Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sangsangin Investment position performs unexpectedly, Hyundai Engineering 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 Hyundai Engineering will offset losses from the drop in Hyundai Engineering's long position.| Sangsangin Investment vs. KB Financial Group | Sangsangin Investment vs. Shinhan Financial Group | Sangsangin Investment vs. Hana Financial | Sangsangin Investment vs. Woori Financial Group |
| Hyundai Engineering vs. Daou Data Corp | Hyundai Engineering vs. Sangsangin Investment Securities | Hyundai Engineering vs. DSC Investment | Hyundai Engineering vs. NICE Information Service |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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