Correlation Between Hyundai Engineering and GeneBioTech
Can any of the company-specific risk be diversified away by investing in both Hyundai Engineering and GeneBioTech 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 GeneBioTech 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 GeneBioTech Co, you can compare the effects of market volatilities on Hyundai Engineering and GeneBioTech 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 GeneBioTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Engineering and GeneBioTech.
Diversification Opportunities for Hyundai Engineering and GeneBioTech
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyundai and GeneBioTech is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Engineering Plastics and GeneBioTech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GeneBioTech 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 GeneBioTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GeneBioTech has no effect on the direction of Hyundai Engineering i.e., Hyundai Engineering and GeneBioTech go up and down completely randomly.
Pair Corralation between Hyundai Engineering and GeneBioTech
Assuming the 90 days trading horizon Hyundai Engineering Plastics is expected to generate 0.91 times more return on investment than GeneBioTech. However, Hyundai Engineering Plastics is 1.1 times less risky than GeneBioTech. It trades about 0.0 of its potential returns per unit of risk. GeneBioTech Co is currently generating about -0.01 per unit of risk. If you would invest 379,328 in Hyundai Engineering Plastics on September 21, 2024 and sell it today you would lose (24,328) from holding Hyundai Engineering Plastics or give up 6.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Engineering Plastics vs. GeneBioTech Co
Performance |
| Timeline |
| Hyundai Engineering |
| GeneBioTech |
Hyundai Engineering and GeneBioTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Engineering and GeneBioTech
The main advantage of trading using opposite Hyundai Engineering and GeneBioTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Engineering position performs unexpectedly, GeneBioTech 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 GeneBioTech will offset losses from the drop in GeneBioTech's long position.| Hyundai Engineering vs. Daou Data Corp | Hyundai Engineering vs. Sangsangin Investment Securities | Hyundai Engineering vs. DSC Investment | Hyundai Engineering vs. NICE Information Service |
| GeneBioTech vs. Hyundai Engineering Plastics | GeneBioTech vs. Dongbu Insurance Co | GeneBioTech vs. Ssangyong Materials Corp | GeneBioTech vs. RF Materials 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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