Correlation Between Guyoung Technology and Hyosung Advanced
Can any of the company-specific risk be diversified away by investing in both Guyoung 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 Guyoung 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 Guyoung Technology Co and Hyosung Advanced Materials, you can compare the effects of market volatilities on Guyoung 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 Guyoung Technology with a short position of Hyosung Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guyoung Technology and Hyosung Advanced.
Diversification Opportunities for Guyoung Technology and Hyosung Advanced
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guyoung and Hyosung is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Guyoung Technology Co 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 Guyoung 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 Guyoung Technology Co 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 Guyoung Technology i.e., Guyoung Technology and Hyosung Advanced go up and down completely randomly.
Pair Corralation between Guyoung Technology and Hyosung Advanced
Assuming the 90 days trading horizon Guyoung Technology Co is expected to generate 1.8 times more return on investment than Hyosung Advanced. However, Guyoung Technology is 1.8 times more volatile than Hyosung Advanced Materials. It trades about 0.17 of its potential returns per unit of risk. Hyosung Advanced Materials is currently generating about -0.26 per unit of risk. If you would invest 205,000 in Guyoung Technology Co on November 7, 2024 and sell it today you would earn a total of 17,000 from holding Guyoung Technology Co or generate 8.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 89.47% |
| Values | Daily Returns |
Guyoung Technology Co vs. Hyosung Advanced Materials
Performance |
| Timeline |
| Guyoung Technology |
| Hyosung Advanced Mat |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Guyoung Technology and Hyosung Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guyoung Technology and Hyosung Advanced
The main advantage of trading using opposite Guyoung Technology and Hyosung Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guyoung 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.| Guyoung Technology vs. Samsung Electronics Co | Guyoung Technology vs. Hyundai Motor Co | Guyoung Technology vs. LG Electronics |
| Hyosung Advanced vs. AeroSpace Technology of | Hyosung Advanced vs. Pan Entertainment Co | Hyosung Advanced vs. Hancom Inc | Hyosung Advanced vs. Samsung Securities |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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