Correlation Between Hyundai and Cosmax Nbt
Can any of the company-specific risk be diversified away by investing in both Hyundai and Cosmax Nbt 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 Cosmax Nbt 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 Cosmax Nbt, you can compare the effects of market volatilities on Hyundai and Cosmax Nbt 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 Cosmax Nbt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Cosmax Nbt.
Diversification Opportunities for Hyundai and Cosmax Nbt
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyundai and Cosmax is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Cosmax Nbt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmax Nbt 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 Cosmax Nbt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmax Nbt has no effect on the direction of Hyundai i.e., Hyundai and Cosmax Nbt go up and down completely randomly.
Pair Corralation between Hyundai and Cosmax Nbt
Assuming the 90 days trading horizon Hyundai Motor Co is expected to generate 0.33 times more return on investment than Cosmax Nbt. However, Hyundai Motor Co is 3.07 times less risky than Cosmax Nbt. It trades about -0.15 of its potential returns per unit of risk. Cosmax Nbt is currently generating about -0.08 per unit of risk. If you would invest 16,360,000 in Hyundai Motor Co on August 26, 2024 and sell it today you would lose (670,000) from holding Hyundai Motor Co or give up 4.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. Cosmax Nbt
Performance |
| Timeline |
| Hyundai Motor |
| Cosmax Nbt |
Hyundai and Cosmax Nbt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Cosmax Nbt
The main advantage of trading using opposite Hyundai and Cosmax Nbt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Cosmax Nbt 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 Cosmax Nbt will offset losses from the drop in Cosmax Nbt's long position.| Hyundai vs. Hyundai Motor Co | Hyundai vs. Busan Industrial Co | Hyundai vs. Busan Ind | Hyundai vs. Mirae Asset Daewoo |
| Cosmax Nbt vs. Nable Communications | Cosmax Nbt vs. Seoyon Topmetal Co | Cosmax Nbt vs. PJ Metal Co | Cosmax Nbt vs. Eagon Industrial Co |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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