Correlation Between Kukil Metal and Hyunwoo Industrial
Can any of the company-specific risk be diversified away by investing in both Kukil Metal and Hyunwoo Industrial 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 Kukil Metal and Hyunwoo Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kukil Metal Co and Hyunwoo Industrial Co, you can compare the effects of market volatilities on Kukil Metal and Hyunwoo Industrial 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 Kukil Metal with a short position of Hyunwoo Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukil Metal and Hyunwoo Industrial.
Diversification Opportunities for Kukil Metal and Hyunwoo Industrial
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kukil and Hyunwoo is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Kukil Metal Co and Hyunwoo Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyunwoo Industrial and Kukil Metal 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 Kukil Metal Co are associated (or correlated) with Hyunwoo Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyunwoo Industrial has no effect on the direction of Kukil Metal i.e., Kukil Metal and Hyunwoo Industrial go up and down completely randomly.
Pair Corralation between Kukil Metal and Hyunwoo Industrial
Assuming the 90 days trading horizon Kukil Metal Co is expected to under-perform the Hyunwoo Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Kukil Metal Co is 1.42 times less risky than Hyunwoo Industrial. The stock trades about -0.3 of its potential returns per unit of risk. The Hyunwoo Industrial Co is currently generating about -0.17 of returns per unit of risk over similar time horizon. If you would invest 283,000 in Hyunwoo Industrial Co on August 29, 2024 and sell it today you would lose (24,500) from holding Hyunwoo Industrial Co or give up 8.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukil Metal Co vs. Hyunwoo Industrial Co
Performance |
| Timeline |
| Kukil Metal |
| Hyunwoo Industrial |
Kukil Metal and Hyunwoo Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukil Metal and Hyunwoo Industrial
The main advantage of trading using opposite Kukil Metal and Hyunwoo Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukil Metal position performs unexpectedly, Hyunwoo Industrial 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 Hyunwoo Industrial will offset losses from the drop in Hyunwoo Industrial's long position.| Kukil Metal vs. Samlip General Foods | Kukil Metal vs. Sangsin Energy Display | Kukil Metal vs. Iljin Display | Kukil Metal vs. Dongbang Transport Logistics |
| Hyunwoo Industrial vs. SK Hynix | Hyunwoo Industrial vs. LX Semicon Co | Hyunwoo Industrial vs. People Technology | Hyunwoo Industrial vs. Hana Materials |
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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