Correlation Between Koryo Credit and Hyundai
Can any of the company-specific risk be diversified away by investing in both Koryo Credit and Hyundai 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 Koryo Credit and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koryo Credit Information and Hyundai Motor Co, you can compare the effects of market volatilities on Koryo Credit and Hyundai 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 Koryo Credit with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koryo Credit and Hyundai.
Diversification Opportunities for Koryo Credit and Hyundai
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Koryo and Hyundai is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Koryo Credit Information and Hyundai Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and Koryo Credit 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 Koryo Credit Information are associated (or correlated) with Hyundai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Motor has no effect on the direction of Koryo Credit i.e., Koryo Credit and Hyundai go up and down completely randomly.
Pair Corralation between Koryo Credit and Hyundai
Assuming the 90 days trading horizon Koryo Credit is expected to generate 9.44 times less return on investment than Hyundai. But when comparing it to its historical volatility, Koryo Credit Information is 1.27 times less risky than Hyundai. It trades about 0.01 of its potential returns per unit of risk. Hyundai Motor Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 7,857,182 in Hyundai Motor Co on October 25, 2024 and sell it today you would earn a total of 7,722,818 from holding Hyundai Motor Co or generate 98.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koryo Credit Information vs. Hyundai Motor Co
Performance |
| Timeline |
| Koryo Credit Information |
| Hyundai Motor |
Koryo Credit and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koryo Credit and Hyundai
The main advantage of trading using opposite Koryo Credit and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koryo Credit position performs unexpectedly, Hyundai 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 will offset losses from the drop in Hyundai's long position.| Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. Samsung Electronics Co | Koryo Credit vs. KB Financial Group | Koryo Credit vs. Shinhan Financial Group |
| Hyundai vs. Dongbang Transport Logistics | Hyundai vs. Daesung Hi Tech Co | Hyundai vs. System and Application | Hyundai vs. LG Household Healthcare |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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