Correlation Between CHOROKBAEM PANY and Hyundai
Can any of the company-specific risk be diversified away by investing in both CHOROKBAEM PANY 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 CHOROKBAEM PANY and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHOROKBAEM PANY Co and Hyundai Motor, you can compare the effects of market volatilities on CHOROKBAEM PANY 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 CHOROKBAEM PANY with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHOROKBAEM PANY and Hyundai.
Diversification Opportunities for CHOROKBAEM PANY and Hyundai
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CHOROKBAEM and Hyundai is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding CHOROKBAEM PANY Co and Hyundai Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and CHOROKBAEM PANY 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 CHOROKBAEM PANY Co 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 CHOROKBAEM PANY i.e., CHOROKBAEM PANY and Hyundai go up and down completely randomly.
Pair Corralation between CHOROKBAEM PANY and Hyundai
Assuming the 90 days trading horizon CHOROKBAEM PANY Co is expected to under-perform the Hyundai. But the stock apears to be less risky and, when comparing its historical volatility, CHOROKBAEM PANY Co is 1.21 times less risky than Hyundai. The stock trades about -0.23 of its potential returns per unit of risk. The Hyundai Motor is currently generating about -0.06 of returns per unit of risk over similar time horizon. If you would invest 24,850,000 in Hyundai Motor on October 14, 2024 and sell it today you would lose (2,250,000) from holding Hyundai Motor or give up 9.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 87.3% |
| Values | Daily Returns |
CHOROKBAEM PANY Co vs. Hyundai Motor
Performance |
| Timeline |
| CHOROKBAEM PANY |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Hyundai Motor |
CHOROKBAEM PANY and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHOROKBAEM PANY and Hyundai
The main advantage of trading using opposite CHOROKBAEM PANY and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHOROKBAEM PANY 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.| CHOROKBAEM PANY vs. DONGKUK TED METAL | CHOROKBAEM PANY vs. Formetal Co | CHOROKBAEM PANY vs. Daiyang Metal Co | CHOROKBAEM PANY vs. MetaLabs Co |
| Hyundai vs. Daou Data Corp | Hyundai vs. System and Application | Hyundai vs. Samsung Life Insurance | Hyundai vs. DataSolution |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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