Correlation Between Jeong Moon and Hyundai Industrial
Can any of the company-specific risk be diversified away by investing in both Jeong Moon and Hyundai Industrial 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 Jeong Moon and Hyundai Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jeong Moon Information and Hyundai Industrial Co, you can compare the effects of market volatilities on Jeong Moon and Hyundai Industrial 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 Jeong Moon with a short position of Hyundai Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jeong Moon and Hyundai Industrial.
Diversification Opportunities for Jeong Moon and Hyundai Industrial
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jeong and Hyundai is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Jeong Moon Information and Hyundai Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Industrial and Jeong Moon 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 Jeong Moon Information are associated (or correlated) with Hyundai Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Industrial has no effect on the direction of Jeong Moon i.e., Jeong Moon and Hyundai Industrial go up and down completely randomly.
Pair Corralation between Jeong Moon and Hyundai Industrial
Assuming the 90 days trading horizon Jeong Moon Information is expected to under-perform the Hyundai Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Jeong Moon Information is 1.37 times less risky than Hyundai Industrial. The stock trades about -0.03 of its potential returns per unit of risk. The Hyundai Industrial Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 655,295 in Hyundai Industrial Co on September 3, 2024 and sell it today you would lose (150,295) from holding Hyundai Industrial Co or give up 22.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jeong Moon Information vs. Hyundai Industrial Co
Performance |
| Timeline |
| Jeong Moon Information |
| Hyundai Industrial |
Jeong Moon and Hyundai Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jeong Moon and Hyundai Industrial
The main advantage of trading using opposite Jeong Moon and Hyundai Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jeong Moon position performs unexpectedly, Hyundai Industrial 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 Hyundai Industrial will offset losses from the drop in Hyundai Industrial's long position.| Jeong Moon vs. Dongsin Engineering Construction | Jeong Moon vs. Doosan Fuel Cell | Jeong Moon vs. Daishin Balance 1 | Jeong Moon vs. Total Soft Bank |
| Hyundai Industrial vs. SK Chemicals Co | Hyundai Industrial vs. Hannong Chemicals | Hyundai Industrial vs. Dongwon Metal Co | Hyundai Industrial vs. Youngsin Metal Industrial |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |