Correlation Between Hyundai Rotem and Hyosung Chemical
Can any of the company-specific risk be diversified away by investing in both Hyundai Rotem and Hyosung Chemical 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 Rotem and Hyosung Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Rotem Co and Hyosung Chemical Corp, you can compare the effects of market volatilities on Hyundai Rotem and Hyosung Chemical 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 Rotem with a short position of Hyosung Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Rotem and Hyosung Chemical.
Diversification Opportunities for Hyundai Rotem and Hyosung Chemical
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyundai and Hyosung is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Rotem Co and Hyosung Chemical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyosung Chemical Corp and Hyundai Rotem 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 Rotem Co are associated (or correlated) with Hyosung Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyosung Chemical Corp has no effect on the direction of Hyundai Rotem i.e., Hyundai Rotem and Hyosung Chemical go up and down completely randomly.
Pair Corralation between Hyundai Rotem and Hyosung Chemical
Assuming the 90 days trading horizon Hyundai Rotem Co is expected to under-perform the Hyosung Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Hyundai Rotem Co is 1.78 times less risky than Hyosung Chemical. The stock trades about -0.21 of its potential returns per unit of risk. The Hyosung Chemical Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 3,965,000 in Hyosung Chemical Corp on September 4, 2024 and sell it today you would lose (215,000) from holding Hyosung Chemical Corp or give up 5.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Hyundai Rotem Co vs. Hyosung Chemical Corp
Performance |
| Timeline |
| Hyundai Rotem |
| Hyosung Chemical Corp |
Hyundai Rotem and Hyosung Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Rotem and Hyosung Chemical
The main advantage of trading using opposite Hyundai Rotem and Hyosung Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Rotem position performs unexpectedly, Hyosung Chemical 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 Chemical will offset losses from the drop in Hyosung Chemical's long position.| Hyundai Rotem vs. Hyosung Chemical Corp | Hyundai Rotem vs. Kyung In Synthetic Corp | Hyundai Rotem vs. JC Chemical Co | Hyundai Rotem vs. Sung Bo Chemicals |
| Hyosung Chemical vs. LG Chem | Hyosung Chemical vs. DukSan Neolux CoLtd | Hyosung Chemical vs. LIG ES SPAC | Hyosung Chemical vs. Sukgyung AT 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |