Correlation Between Hyundai Glovis and Korea New
Can any of the company-specific risk be diversified away by investing in both Hyundai Glovis and Korea New 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 Glovis and Korea New into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Glovis and Korea New Network, you can compare the effects of market volatilities on Hyundai Glovis and Korea New 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 Glovis with a short position of Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Glovis and Korea New.
Diversification Opportunities for Hyundai Glovis and Korea New
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyundai and Korea is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Glovis and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network and Hyundai Glovis 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 Glovis are associated (or correlated) with Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of Hyundai Glovis i.e., Hyundai Glovis and Korea New go up and down completely randomly.
Pair Corralation between Hyundai Glovis and Korea New
Assuming the 90 days trading horizon Hyundai Glovis is expected to generate 1.2 times more return on investment than Korea New. However, Hyundai Glovis is 1.2 times more volatile than Korea New Network. It trades about 0.08 of its potential returns per unit of risk. Korea New Network is currently generating about -0.08 per unit of risk. If you would invest 8,520,453 in Hyundai Glovis on September 3, 2024 and sell it today you would earn a total of 3,779,547 from holding Hyundai Glovis or generate 44.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Glovis vs. Korea New Network
Performance |
| Timeline |
| Hyundai Glovis |
| Korea New Network |
Hyundai Glovis and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Glovis and Korea New
The main advantage of trading using opposite Hyundai Glovis and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Glovis position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.| Hyundai Glovis vs. Jeju Bank | Hyundai Glovis vs. Pureun Mutual Savings | Hyundai Glovis vs. BNK Financial Group | Hyundai Glovis vs. Incar Financial Service |
| Korea New vs. Daejoo Electronic Materials | Korea New vs. Lake Materials Co | Korea New vs. Lotte Energy Materials | Korea New vs. EV Advanced Material |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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