Correlation Between Hyundai Engineering and Seung Il
Can any of the company-specific risk be diversified away by investing in both Hyundai Engineering and Seung Il 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 Seung Il 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 Seung Il, you can compare the effects of market volatilities on Hyundai Engineering and Seung Il 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 Seung Il. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Engineering and Seung Il.
Diversification Opportunities for Hyundai Engineering and Seung Il
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyundai and Seung is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Engineering Plastics and Seung Il in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seung Il 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 Seung Il. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seung Il has no effect on the direction of Hyundai Engineering i.e., Hyundai Engineering and Seung Il go up and down completely randomly.
Pair Corralation between Hyundai Engineering and Seung Il
Assuming the 90 days trading horizon Hyundai Engineering Plastics is expected to under-perform the Seung Il. But the stock apears to be less risky and, when comparing its historical volatility, Hyundai Engineering Plastics is 1.49 times less risky than Seung Il. The stock trades about -0.08 of its potential returns per unit of risk. The Seung Il is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 747,000 in Seung Il on October 30, 2024 and sell it today you would earn a total of 26,000 from holding Seung Il or generate 3.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Engineering Plastics vs. Seung Il
Performance |
| Timeline |
| Hyundai Engineering |
| Seung Il |
Hyundai Engineering and Seung Il Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Engineering and Seung Il
The main advantage of trading using opposite Hyundai Engineering and Seung Il positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Engineering position performs unexpectedly, Seung Il 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 Seung Il will offset losses from the drop in Seung Il's long position.| Hyundai Engineering vs. Kakao Games Corp | Hyundai Engineering vs. SEOJEON ELECTRIC MACHINERY | Hyundai Engineering vs. Hanshin Construction Co | Hyundai Engineering vs. Dongwoo Farm To |
| Seung Il vs. Hankukpackage Co | Seung Il vs. Busan Industrial Co | Seung Il vs. Busan Ind | Seung Il vs. Shinhan WTI Futures |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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