Correlation Between Hyundai and Assems
Can any of the company-specific risk be diversified away by investing in both Hyundai and Assems 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 Assems 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 Assems Inc, you can compare the effects of market volatilities on Hyundai and Assems 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 Assems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Assems.
Diversification Opportunities for Hyundai and Assems
Very good diversification
The 3 months correlation between Hyundai and Assems is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Assems Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assems Inc 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 Assems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assems Inc has no effect on the direction of Hyundai i.e., Hyundai and Assems go up and down completely randomly.
Pair Corralation between Hyundai and Assems
Assuming the 90 days trading horizon Hyundai Motor Co is expected to generate 1.17 times more return on investment than Assems. However, Hyundai is 1.17 times more volatile than Assems Inc. It trades about -0.02 of its potential returns per unit of risk. Assems Inc is currently generating about -0.44 per unit of risk. If you would invest 16,500,000 in Hyundai Motor Co on August 31, 2024 and sell it today you would lose (190,000) from holding Hyundai Motor Co or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hyundai Motor Co vs. Assems Inc
Performance |
| Timeline |
| Hyundai Motor |
| Assems Inc |
Hyundai and Assems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Assems
The main advantage of trading using opposite Hyundai and Assems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Assems 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 Assems will offset losses from the drop in Assems' long position.| Hyundai vs. Korea Electronic Certification | Hyundai vs. Lotte Non Life Insurance | Hyundai vs. Cuckoo Electronics Co | Hyundai vs. LG Electronics |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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