Correlation Between Hyundai Engineering and Youngsin Metal
Can any of the company-specific risk be diversified away by investing in both Hyundai Engineering and Youngsin Metal 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 Engineering and Youngsin Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Engineering Plastics and Youngsin Metal Industrial, you can compare the effects of market volatilities on Hyundai Engineering and Youngsin Metal 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 Engineering with a short position of Youngsin Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Engineering and Youngsin Metal.
Diversification Opportunities for Hyundai Engineering and Youngsin Metal
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hyundai and Youngsin is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Engineering Plastics and Youngsin Metal Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngsin Metal Industrial and Hyundai Engineering 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 Engineering Plastics are associated (or correlated) with Youngsin Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngsin Metal Industrial has no effect on the direction of Hyundai Engineering i.e., Hyundai Engineering and Youngsin Metal go up and down completely randomly.
Pair Corralation between Hyundai Engineering and Youngsin Metal
Assuming the 90 days trading horizon Hyundai Engineering Plastics is expected to generate 0.33 times more return on investment than Youngsin Metal. However, Hyundai Engineering Plastics is 2.99 times less risky than Youngsin Metal. It trades about -0.13 of its potential returns per unit of risk. Youngsin Metal Industrial is currently generating about -0.28 per unit of risk. If you would invest 350,000 in Hyundai Engineering Plastics on November 7, 2024 and sell it today you would lose (6,000) from holding Hyundai Engineering Plastics or give up 1.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Engineering Plastics vs. Youngsin Metal Industrial
Performance |
| Timeline |
| Hyundai Engineering |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Youngsin Metal Industrial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hyundai Engineering and Youngsin Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Engineering and Youngsin Metal
The main advantage of trading using opposite Hyundai Engineering and Youngsin Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Engineering position performs unexpectedly, Youngsin Metal 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 Youngsin Metal will offset losses from the drop in Youngsin Metal's long position.| Hyundai Engineering vs. Kg Chemical | Hyundai Engineering vs. Neungyule Education | Hyundai Engineering vs. Dongbang Transport Logistics | Hyundai Engineering vs. UJU Electronics Co |
| Youngsin Metal vs. SH Energy Chemical | Youngsin Metal vs. AeroSpace Technology of | Youngsin Metal vs. SK Chemicals Co | Youngsin Metal vs. Vina Technology 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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