Correlation Between Hyundai and NH SPAC
Can any of the company-specific risk be diversified away by investing in both Hyundai and NH SPAC 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 NH SPAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor Co and NH SPAC 8, you can compare the effects of market volatilities on Hyundai and NH SPAC 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 NH SPAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and NH SPAC.
Diversification Opportunities for Hyundai and NH SPAC
Excellent diversification
The 3 months correlation between Hyundai and 218410 is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and NH SPAC 8 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH SPAC 8 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 Co are associated (or correlated) with NH SPAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH SPAC 8 has no effect on the direction of Hyundai i.e., Hyundai and NH SPAC go up and down completely randomly.
Pair Corralation between Hyundai and NH SPAC
Assuming the 90 days trading horizon Hyundai Motor Co is expected to generate 0.65 times more return on investment than NH SPAC. However, Hyundai Motor Co is 1.54 times less risky than NH SPAC. It trades about 0.1 of its potential returns per unit of risk. NH SPAC 8 is currently generating about -0.03 per unit of risk. If you would invest 6,996,971 in Hyundai Motor Co on September 3, 2024 and sell it today you would earn a total of 8,703,029 from holding Hyundai Motor Co or generate 124.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. NH SPAC 8
Performance |
| Timeline |
| Hyundai Motor |
| NH SPAC 8 |
Hyundai and NH SPAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and NH SPAC
The main advantage of trading using opposite Hyundai and NH SPAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, NH SPAC 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 NH SPAC will offset losses from the drop in NH SPAC's long position.| Hyundai vs. NewFlex Technology Co | Hyundai vs. KG Eco Technology | Hyundai vs. Solution Advanced Technology | Hyundai vs. iNtRON Biotechnology |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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