Correlation Between Hyundai and Cosmax
Can any of the company-specific risk be diversified away by investing in both Hyundai and Cosmax 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 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 Inc, you can compare the effects of market volatilities on Hyundai and Cosmax 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. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Cosmax.
Diversification Opportunities for Hyundai and Cosmax
Very good diversification
The 3 months correlation between Hyundai and Cosmax is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Cosmax Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cosmax 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 Cosmax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cosmax Inc has no effect on the direction of Hyundai i.e., Hyundai and Cosmax go up and down completely randomly.
Pair Corralation between Hyundai and Cosmax
Assuming the 90 days trading horizon Hyundai Motor Co is expected to generate 0.75 times more return on investment than Cosmax. However, Hyundai Motor Co is 1.34 times less risky than Cosmax. It trades about 0.09 of its potential returns per unit of risk. Cosmax Inc is currently generating about 0.03 per unit of risk. If you would invest 9,976,129 in Hyundai Motor Co on September 2, 2024 and sell it today you would earn a total of 6,043,871 from holding Hyundai Motor Co or generate 60.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. Cosmax Inc
Performance |
| Timeline |
| Hyundai Motor |
| Cosmax Inc |
Hyundai and Cosmax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Cosmax
The main advantage of trading using opposite Hyundai and Cosmax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Cosmax 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 will offset losses from the drop in Cosmax's long position.| Hyundai vs. Busan Industrial Co | Hyundai vs. Busan Ind | Hyundai vs. Mirae Asset Daewoo | Hyundai vs. Shinhan WTI Futures |
| Cosmax vs. E Investment Development | Cosmax vs. Cuckoo Electronics Co | Cosmax vs. Daeduck Electronics Co | Cosmax vs. Daol Investment Securities |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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