Correlation Between Hyundai and JYP Entertainment
Can any of the company-specific risk be diversified away by investing in both Hyundai and JYP Entertainment 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 JYP Entertainment 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 JYP Entertainment, you can compare the effects of market volatilities on Hyundai and JYP Entertainment 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 JYP Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and JYP Entertainment.
Diversification Opportunities for Hyundai and JYP Entertainment
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyundai and JYP is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and JYP Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JYP Entertainment 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 JYP Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JYP Entertainment has no effect on the direction of Hyundai i.e., Hyundai and JYP Entertainment go up and down completely randomly.
Pair Corralation between Hyundai and JYP Entertainment
Assuming the 90 days trading horizon Hyundai is expected to generate 3.11 times less return on investment than JYP Entertainment. But when comparing it to its historical volatility, Hyundai Motor Co is 2.39 times less risky than JYP Entertainment. It trades about 0.09 of its potential returns per unit of risk. JYP Entertainment is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 7,171,051 in JYP Entertainment on October 20, 2024 and sell it today you would earn a total of 468,949 from holding JYP Entertainment or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. JYP Entertainment
Performance |
| Timeline |
| Hyundai Motor |
| JYP Entertainment |
Hyundai and JYP Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and JYP Entertainment
The main advantage of trading using opposite Hyundai and JYP Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, JYP Entertainment 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 JYP Entertainment will offset losses from the drop in JYP Entertainment's long position.| Hyundai vs. EBEST Investment Securities | Hyundai vs. Pan Entertainment Co | Hyundai vs. Nh Investment And | Hyundai vs. SAMG Entertainment Co |
| JYP Entertainment vs. YG Entertainment | JYP Entertainment vs. SM Entertainment Co | JYP Entertainment vs. Cube Entertainment |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |