Correlation Between Woori Technology and Hyosung Advanced
Can any of the company-specific risk be diversified away by investing in both Woori Technology 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 Woori Technology and Hyosung Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology Investment and Hyosung Advanced Materials, you can compare the effects of market volatilities on Woori Technology 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 Woori Technology with a short position of Hyosung Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and Hyosung Advanced.
Diversification Opportunities for Woori Technology and Hyosung Advanced
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Woori and Hyosung is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology Investment 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 Woori Technology 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 Woori Technology Investment 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 Woori Technology i.e., Woori Technology and Hyosung Advanced go up and down completely randomly.
Pair Corralation between Woori Technology and Hyosung Advanced
Assuming the 90 days trading horizon Woori Technology Investment is expected to generate 1.58 times more return on investment than Hyosung Advanced. However, Woori Technology is 1.58 times more volatile than Hyosung Advanced Materials. It trades about 0.01 of its potential returns per unit of risk. Hyosung Advanced Materials is currently generating about -0.21 per unit of risk. If you would invest 927,000 in Woori Technology Investment on September 3, 2024 and sell it today you would lose (49,000) from holding Woori Technology Investment or give up 5.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Technology Investment vs. Hyosung Advanced Materials
Performance |
| Timeline |
| Woori Technology Inv |
| Hyosung Advanced Mat |
Woori Technology and Hyosung Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and Hyosung Advanced
The main advantage of trading using opposite Woori Technology and Hyosung Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology 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.| Woori Technology vs. Humasis Co | Woori Technology vs. JUSUNG ENGINEERING Co | Woori Technology vs. Winix Inc | Woori Technology vs. AfreecaTV Co |
| Hyosung Advanced vs. Busan Industrial Co | Hyosung Advanced vs. UNISEM Co | Hyosung Advanced vs. RPBio Inc | Hyosung Advanced vs. Finebesteel |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Transaction History View history of all your transactions and understand their impact on performance |