Correlation Between Samyoung Electronics and Hyosung Heavy
Can any of the company-specific risk be diversified away by investing in both Samyoung Electronics and Hyosung Heavy 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 Samyoung Electronics and Hyosung Heavy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samyoung Electronics Co and Hyosung Heavy Industries, you can compare the effects of market volatilities on Samyoung Electronics and Hyosung Heavy 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 Samyoung Electronics with a short position of Hyosung Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyoung Electronics and Hyosung Heavy.
Diversification Opportunities for Samyoung Electronics and Hyosung Heavy
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Samyoung and Hyosung is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Samyoung Electronics Co and Hyosung Heavy Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyosung Heavy Industries and Samyoung Electronics 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 Samyoung Electronics Co are associated (or correlated) with Hyosung Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyosung Heavy Industries has no effect on the direction of Samyoung Electronics i.e., Samyoung Electronics and Hyosung Heavy go up and down completely randomly.
Pair Corralation between Samyoung Electronics and Hyosung Heavy
Assuming the 90 days trading horizon Samyoung Electronics is expected to generate 16.6 times less return on investment than Hyosung Heavy. But when comparing it to its historical volatility, Samyoung Electronics Co is 2.63 times less risky than Hyosung Heavy. It trades about 0.02 of its potential returns per unit of risk. Hyosung Heavy Industries is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 6,705,680 in Hyosung Heavy Industries on September 1, 2024 and sell it today you would earn a total of 33,644,320 from holding Hyosung Heavy Industries or generate 501.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.77% |
| Values | Daily Returns |
Samyoung Electronics Co vs. Hyosung Heavy Industries
Performance |
| Timeline |
| Samyoung Electronics |
| Hyosung Heavy Industries |
Samyoung Electronics and Hyosung Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyoung Electronics and Hyosung Heavy
The main advantage of trading using opposite Samyoung Electronics and Hyosung Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyoung Electronics position performs unexpectedly, Hyosung Heavy 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 Hyosung Heavy will offset losses from the drop in Hyosung Heavy's long position.| Samyoung Electronics vs. AptaBio Therapeutics | Samyoung Electronics vs. Daewoo SBI SPAC | Samyoung Electronics vs. Dream Security co | Samyoung Electronics vs. Microfriend |
| Hyosung Heavy vs. LG Energy Solution | Hyosung Heavy vs. Doosan Heavy Ind | Hyosung Heavy vs. Aprogen KIC | Hyosung Heavy vs. SNTEnergy 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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