Correlation Between Hyundai Elevator and Hankook Steel
Can any of the company-specific risk be diversified away by investing in both Hyundai Elevator and Hankook Steel 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 Elevator and Hankook Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Elevator and Hankook Steel Co, you can compare the effects of market volatilities on Hyundai Elevator and Hankook Steel 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 Elevator with a short position of Hankook Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Elevator and Hankook Steel.
Diversification Opportunities for Hyundai Elevator and Hankook Steel
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hyundai and Hankook is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Elevator and Hankook Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hankook Steel and Hyundai Elevator 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 Elevator are associated (or correlated) with Hankook Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hankook Steel has no effect on the direction of Hyundai Elevator i.e., Hyundai Elevator and Hankook Steel go up and down completely randomly.
Pair Corralation between Hyundai Elevator and Hankook Steel
Assuming the 90 days trading horizon Hyundai Elevator is expected to generate 0.4 times more return on investment than Hankook Steel. However, Hyundai Elevator is 2.53 times less risky than Hankook Steel. It trades about 0.25 of its potential returns per unit of risk. Hankook Steel Co is currently generating about 0.09 per unit of risk. If you would invest 4,590,000 in Hyundai Elevator on September 2, 2024 and sell it today you would earn a total of 700,000 from holding Hyundai Elevator or generate 15.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Elevator vs. Hankook Steel Co
Performance |
| Timeline |
| Hyundai Elevator |
| Hankook Steel |
Hyundai Elevator and Hankook Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Elevator and Hankook Steel
The main advantage of trading using opposite Hyundai Elevator and Hankook Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Elevator position performs unexpectedly, Hankook Steel 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 Hankook Steel will offset losses from the drop in Hankook Steel's long position.| Hyundai Elevator vs. Korea New Network | Hyundai Elevator vs. ICD Co | Hyundai Elevator vs. DYPNF CoLtd | Hyundai Elevator vs. Busan Industrial Co |
| Hankook Steel vs. AptaBio Therapeutics | Hankook Steel vs. Daewoo SBI SPAC | Hankook Steel vs. Dream Security co | Hankook Steel vs. Microfriend |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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