Correlation Between Hyundai Home and FoodNamoo
Can any of the company-specific risk be diversified away by investing in both Hyundai Home and FoodNamoo 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 Hyundai Home and FoodNamoo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Home Shopping and FoodNamoo, you can compare the effects of market volatilities on Hyundai Home and FoodNamoo 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 Hyundai Home with a short position of FoodNamoo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Home and FoodNamoo.
Diversification Opportunities for Hyundai Home and FoodNamoo
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyundai and FoodNamoo is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Home Shopping and FoodNamoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FoodNamoo and Hyundai Home 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 Hyundai Home Shopping are associated (or correlated) with FoodNamoo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FoodNamoo has no effect on the direction of Hyundai Home i.e., Hyundai Home and FoodNamoo go up and down completely randomly.
Pair Corralation between Hyundai Home and FoodNamoo
Assuming the 90 days trading horizon Hyundai Home Shopping is expected to generate 0.43 times more return on investment than FoodNamoo. However, Hyundai Home Shopping is 2.34 times less risky than FoodNamoo. It trades about 0.01 of its potential returns per unit of risk. FoodNamoo is currently generating about -0.04 per unit of risk. If you would invest 4,498,621 in Hyundai Home Shopping on September 25, 2024 and sell it today you would earn a total of 91,379 from holding Hyundai Home Shopping or generate 2.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.93% |
| Values | Daily Returns |
Hyundai Home Shopping vs. FoodNamoo
Performance |
| Timeline |
| Hyundai Home Shopping |
| FoodNamoo |
Hyundai Home and FoodNamoo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Home and FoodNamoo
The main advantage of trading using opposite Hyundai Home and FoodNamoo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Home position performs unexpectedly, FoodNamoo 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 FoodNamoo will offset losses from the drop in FoodNamoo's long position.| Hyundai Home vs. KIWI Media Group | Hyundai Home vs. Pan Entertainment Co | Hyundai Home vs. Kbi Metal Co | Hyundai Home vs. SM Entertainment Co |
| FoodNamoo vs. Woori Technology | FoodNamoo vs. Hwangkum Steel Technology | FoodNamoo vs. Daishin Information Communications | FoodNamoo vs. Kisan Telecom Co |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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