Correlation Between Hankukpackage and Hyundai Engineering
Can any of the company-specific risk be diversified away by investing in both Hankukpackage and Hyundai Engineering 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 Hankukpackage and Hyundai Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hankukpackage Co and Hyundai Engineering Construction, you can compare the effects of market volatilities on Hankukpackage and Hyundai Engineering 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 Hankukpackage with a short position of Hyundai Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hankukpackage and Hyundai Engineering.
Diversification Opportunities for Hankukpackage and Hyundai Engineering
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hankukpackage and Hyundai is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Hankukpackage Co and Hyundai Engineering Constructi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Engineering and Hankukpackage 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 Hankukpackage Co are associated (or correlated) with Hyundai Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Engineering has no effect on the direction of Hankukpackage i.e., Hankukpackage and Hyundai Engineering go up and down completely randomly.
Pair Corralation between Hankukpackage and Hyundai Engineering
Assuming the 90 days trading horizon Hankukpackage Co is expected to under-perform the Hyundai Engineering. In addition to that, Hankukpackage is 1.02 times more volatile than Hyundai Engineering Construction. It trades about -0.04 of its total potential returns per unit of risk. Hyundai Engineering Construction is currently generating about -0.03 per unit of volatility. If you would invest 3,625,073 in Hyundai Engineering Construction on September 27, 2024 and sell it today you would lose (1,025,073) from holding Hyundai Engineering Construction or give up 28.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hankukpackage Co vs. Hyundai Engineering Constructi
Performance |
| Timeline |
| Hankukpackage |
| Hyundai Engineering |
Hankukpackage and Hyundai Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hankukpackage and Hyundai Engineering
The main advantage of trading using opposite Hankukpackage and Hyundai Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hankukpackage position performs unexpectedly, Hyundai Engineering 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 Engineering will offset losses from the drop in Hyundai Engineering's long position.| Hankukpackage vs. Pum Tech Korea Co | Hankukpackage vs. Seung Il | Hankukpackage vs. Naver | Hankukpackage vs. Gyeongnam Steel Co |
| Hyundai Engineering vs. PlayD Co | Hyundai Engineering vs. Ssangyong Information Communication | Hyundai Engineering vs. Korea Alcohol Industrial | Hyundai Engineering vs. Samick Musical Instruments |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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