Correlation Between SungMoon Electronics and Hyosung Advanced
Can any of the company-specific risk be diversified away by investing in both SungMoon Electronics 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 SungMoon Electronics and Hyosung Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SungMoon Electronics Co and Hyosung Advanced Materials, you can compare the effects of market volatilities on SungMoon Electronics 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 SungMoon Electronics with a short position of Hyosung Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of SungMoon Electronics and Hyosung Advanced.
Diversification Opportunities for SungMoon Electronics and Hyosung Advanced
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SungMoon and Hyosung is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding SungMoon Electronics Co 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 SungMoon 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 SungMoon Electronics Co 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 SungMoon Electronics i.e., SungMoon Electronics and Hyosung Advanced go up and down completely randomly.
Pair Corralation between SungMoon Electronics and Hyosung Advanced
Assuming the 90 days trading horizon SungMoon Electronics Co is expected to generate 0.97 times more return on investment than Hyosung Advanced. However, SungMoon Electronics Co is 1.04 times less risky than Hyosung Advanced. It trades about -0.03 of its potential returns per unit of risk. Hyosung Advanced Materials is currently generating about -0.08 per unit of risk. If you would invest 149,000 in SungMoon Electronics Co on October 27, 2024 and sell it today you would lose (32,700) from holding SungMoon Electronics Co or give up 21.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SungMoon Electronics Co vs. Hyosung Advanced Materials
Performance |
| Timeline |
| SungMoon Electronics |
| Hyosung Advanced Mat |
SungMoon Electronics and Hyosung Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SungMoon Electronics and Hyosung Advanced
The main advantage of trading using opposite SungMoon Electronics and Hyosung Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SungMoon Electronics 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.| SungMoon Electronics vs. KB Financial Group | SungMoon Electronics vs. Shinhan Financial Group | SungMoon Electronics vs. Hana Financial | SungMoon Electronics vs. Woori Financial Group |
| Hyosung Advanced vs. Camus Engineering Construction | Hyosung Advanced vs. Hanshin Construction Co | Hyosung Advanced vs. GS Engineering Construction | Hyosung Advanced vs. ENERGYMACHINERY KOREA CoLtd |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| CEOs Directory Screen CEOs from public companies around the world |