Correlation Between Hyunwoo Industrial and Automobile
Can any of the company-specific risk be diversified away by investing in both Hyunwoo Industrial and Automobile 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 Hyunwoo Industrial and Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyunwoo Industrial Co and Automobile Pc, you can compare the effects of market volatilities on Hyunwoo Industrial and Automobile 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 Hyunwoo Industrial with a short position of Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyunwoo Industrial and Automobile.
Diversification Opportunities for Hyunwoo Industrial and Automobile
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyunwoo and Automobile is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Hyunwoo Industrial Co and Automobile Pc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automobile Pc and Hyunwoo Industrial 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 Hyunwoo Industrial Co are associated (or correlated) with Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automobile Pc has no effect on the direction of Hyunwoo Industrial i.e., Hyunwoo Industrial and Automobile go up and down completely randomly.
Pair Corralation between Hyunwoo Industrial and Automobile
Assuming the 90 days trading horizon Hyunwoo Industrial Co is expected to generate 0.74 times more return on investment than Automobile. However, Hyunwoo Industrial Co is 1.35 times less risky than Automobile. It trades about -0.03 of its potential returns per unit of risk. Automobile Pc is currently generating about -0.04 per unit of risk. If you would invest 419,831 in Hyunwoo Industrial Co on September 2, 2024 and sell it today you would lose (172,831) from holding Hyunwoo Industrial Co or give up 41.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyunwoo Industrial Co vs. Automobile Pc
Performance |
| Timeline |
| Hyunwoo Industrial |
| Automobile Pc |
Hyunwoo Industrial and Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyunwoo Industrial and Automobile
The main advantage of trading using opposite Hyunwoo Industrial and Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyunwoo Industrial position performs unexpectedly, Automobile 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 Automobile will offset losses from the drop in Automobile's long position.| Hyunwoo Industrial vs. SK Hynix | Hyunwoo Industrial vs. LX Semicon Co | Hyunwoo Industrial vs. People Technology | Hyunwoo Industrial vs. SIMMTECH Co |
| Automobile vs. LG Display | Automobile vs. Hyundai Motor Co | Automobile vs. Hyundai Motor Co | Automobile vs. Adaptive Plasma Technology |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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