Correlation Between Seoul Food and Hyundai Green
Can any of the company-specific risk be diversified away by investing in both Seoul Food and Hyundai Green 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 Seoul Food and Hyundai Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seoul Food Industrial and Hyundai Green Food, you can compare the effects of market volatilities on Seoul Food and Hyundai Green 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 Seoul Food with a short position of Hyundai Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seoul Food and Hyundai Green.
Diversification Opportunities for Seoul Food and Hyundai Green
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Seoul and Hyundai is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Seoul Food Industrial and Hyundai Green Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Green Food and Seoul Food 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 Seoul Food Industrial are associated (or correlated) with Hyundai Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Green Food has no effect on the direction of Seoul Food i.e., Seoul Food and Hyundai Green go up and down completely randomly.
Pair Corralation between Seoul Food and Hyundai Green
Assuming the 90 days trading horizon Seoul Food Industrial is expected to under-perform the Hyundai Green. But the stock apears to be less risky and, when comparing its historical volatility, Seoul Food Industrial is 1.03 times less risky than Hyundai Green. The stock trades about -0.13 of its potential returns per unit of risk. The Hyundai Green Food is currently generating about 0.45 of returns per unit of risk over similar time horizon. If you would invest 1,167,000 in Hyundai Green Food on September 1, 2024 and sell it today you would earn a total of 208,000 from holding Hyundai Green Food or generate 17.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seoul Food Industrial vs. Hyundai Green Food
Performance |
| Timeline |
| Seoul Food Industrial |
| Hyundai Green Food |
Seoul Food and Hyundai Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seoul Food and Hyundai Green
The main advantage of trading using opposite Seoul Food and Hyundai Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seoul Food position performs unexpectedly, Hyundai Green 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 Green will offset losses from the drop in Hyundai Green's long position.| Seoul Food vs. SBI Investment KOREA | Seoul Food vs. E Investment Development | Seoul Food vs. SV Investment | Seoul Food vs. Daol Investment Securities |
| Hyundai Green vs. Samsung Electronics Co | Hyundai Green vs. Samsung Electronics Co | Hyundai Green vs. LG Energy Solution | Hyundai Green 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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