Correlation Between Mirae Asset and Hyosung Advanced
Can any of the company-specific risk be diversified away by investing in both Mirae Asset and Hyosung Advanced 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 Mirae Asset and Hyosung Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mirae Asset Daewoo and Hyosung Advanced Materials, you can compare the effects of market volatilities on Mirae Asset and Hyosung Advanced 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 Mirae Asset with a short position of Hyosung Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mirae Asset and Hyosung Advanced.
Diversification Opportunities for Mirae Asset and Hyosung Advanced
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mirae and Hyosung is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Mirae Asset Daewoo and Hyosung Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyosung Advanced Mat and Mirae Asset 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 Mirae Asset Daewoo are associated (or correlated) with Hyosung Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyosung Advanced Mat has no effect on the direction of Mirae Asset i.e., Mirae Asset and Hyosung Advanced go up and down completely randomly.
Pair Corralation between Mirae Asset and Hyosung Advanced
Assuming the 90 days trading horizon Mirae Asset Daewoo is expected to generate 1.93 times more return on investment than Hyosung Advanced. However, Mirae Asset is 1.93 times more volatile than Hyosung Advanced Materials. It trades about 0.05 of its potential returns per unit of risk. Hyosung Advanced Materials is currently generating about -0.43 per unit of risk. If you would invest 425,500 in Mirae Asset Daewoo on August 25, 2024 and sell it today you would earn a total of 14,500 from holding Mirae Asset Daewoo or generate 3.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mirae Asset Daewoo vs. Hyosung Advanced Materials
Performance |
| Timeline |
| Mirae Asset Daewoo |
| Hyosung Advanced Mat |
Mirae Asset and Hyosung Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mirae Asset and Hyosung Advanced
The main advantage of trading using opposite Mirae Asset and Hyosung Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirae Asset position performs unexpectedly, Hyosung Advanced 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 Advanced will offset losses from the drop in Hyosung Advanced's long position.| Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. LG Energy Solution | Mirae Asset vs. SK Hynix |
| Hyosung Advanced vs. Busan Industrial Co | Hyosung Advanced vs. Busan Ind | Hyosung Advanced vs. Mirae Asset Daewoo | Hyosung Advanced vs. UNISEM 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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