Correlation Between Hyundai and Seohee Construction
Can any of the company-specific risk be diversified away by investing in both Hyundai and Seohee Construction 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 Hyundai and Seohee Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor and Seohee Construction Co, you can compare the effects of market volatilities on Hyundai and Seohee Construction 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 Hyundai with a short position of Seohee Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Seohee Construction.
Diversification Opportunities for Hyundai and Seohee Construction
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyundai and Seohee is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor and Seohee Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seohee Construction and Hyundai 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 Hyundai Motor are associated (or correlated) with Seohee Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seohee Construction has no effect on the direction of Hyundai i.e., Hyundai and Seohee Construction go up and down completely randomly.
Pair Corralation between Hyundai and Seohee Construction
Assuming the 90 days trading horizon Hyundai is expected to generate 7.68 times less return on investment than Seohee Construction. In addition to that, Hyundai is 1.69 times more volatile than Seohee Construction Co. It trades about 0.0 of its total potential returns per unit of risk. Seohee Construction Co is currently generating about 0.06 per unit of volatility. If you would invest 123,500 in Seohee Construction Co on August 25, 2024 and sell it today you would earn a total of 17,400 from holding Seohee Construction Co or generate 14.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.45% |
| Values | Daily Returns |
Hyundai Motor vs. Seohee Construction Co
Performance |
| Timeline |
| Hyundai Motor |
| Seohee Construction |
Hyundai and Seohee Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Seohee Construction
The main advantage of trading using opposite Hyundai and Seohee Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Seohee Construction 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 Seohee Construction will offset losses from the drop in Seohee Construction's long position.| Hyundai vs. HB Technology TD | Hyundai vs. Ssangyong Information Communication | Hyundai vs. Dongil Technology | Hyundai vs. ZUM Internet Corp |
| Seohee Construction vs. Samsung Electronics Co | Seohee Construction vs. Samsung Electronics Co | Seohee Construction vs. Hyundai Motor Co | Seohee Construction vs. Hyundai Motor |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |