Correlation Between Hyundai and GAMEVIL
Can any of the company-specific risk be diversified away by investing in both Hyundai and GAMEVIL 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 GAMEVIL 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 GAMEVIL, you can compare the effects of market volatilities on Hyundai and GAMEVIL 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 GAMEVIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and GAMEVIL.
Diversification Opportunities for Hyundai and GAMEVIL
Very good diversification
The 3 months correlation between Hyundai and GAMEVIL is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and GAMEVIL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMEVIL 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 GAMEVIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMEVIL has no effect on the direction of Hyundai i.e., Hyundai and GAMEVIL go up and down completely randomly.
Pair Corralation between Hyundai and GAMEVIL
Assuming the 90 days trading horizon Hyundai Motor Co is expected to under-perform the GAMEVIL. But the stock apears to be less risky and, when comparing its historical volatility, Hyundai Motor Co is 4.44 times less risky than GAMEVIL. The stock trades about -0.06 of its potential returns per unit of risk. The GAMEVIL is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 2,220,000 in GAMEVIL on September 3, 2024 and sell it today you would earn a total of 1,040,000 from holding GAMEVIL or generate 46.85% 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. GAMEVIL
Performance |
| Timeline |
| Hyundai Motor |
| GAMEVIL |
Hyundai and GAMEVIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and GAMEVIL
The main advantage of trading using opposite Hyundai and GAMEVIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, GAMEVIL 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 GAMEVIL will offset losses from the drop in GAMEVIL's long position.| Hyundai vs. Kaonmedia Co | Hyundai vs. GS Retail Co | Hyundai vs. TK Chemical | Hyundai vs. Next Entertainment World |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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