Correlation Between Hyunwoo Industrial and Guyoung Technology
Can any of the company-specific risk be diversified away by investing in both Hyunwoo Industrial and Guyoung Technology 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 Guyoung Technology 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 Guyoung Technology Co, you can compare the effects of market volatilities on Hyunwoo Industrial and Guyoung Technology 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 Guyoung Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyunwoo Industrial and Guyoung Technology.
Diversification Opportunities for Hyunwoo Industrial and Guyoung Technology
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyunwoo and Guyoung is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Hyunwoo Industrial Co and Guyoung Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guyoung Technology 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 Guyoung Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guyoung Technology has no effect on the direction of Hyunwoo Industrial i.e., Hyunwoo Industrial and Guyoung Technology go up and down completely randomly.
Pair Corralation between Hyunwoo Industrial and Guyoung Technology
Assuming the 90 days trading horizon Hyunwoo Industrial Co is expected to under-perform the Guyoung Technology. In addition to that, Hyunwoo Industrial is 1.15 times more volatile than Guyoung Technology Co. It trades about -0.03 of its total potential returns per unit of risk. Guyoung Technology Co is currently generating about 0.01 per unit of volatility. If you would invest 221,016 in Guyoung Technology Co on November 7, 2024 and sell it today you would earn a total of 984.00 from holding Guyoung Technology Co or generate 0.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyunwoo Industrial Co vs. Guyoung Technology Co
Performance |
| Timeline |
| Hyunwoo Industrial |
| Guyoung Technology |
Hyunwoo Industrial and Guyoung Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyunwoo Industrial and Guyoung Technology
The main advantage of trading using opposite Hyunwoo Industrial and Guyoung Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyunwoo Industrial position performs unexpectedly, Guyoung Technology 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 Guyoung Technology will offset losses from the drop in Guyoung Technology's long position.| Hyunwoo Industrial vs. Daejung Chemicals Metals | Hyunwoo Industrial vs. Korea Shipbuilding Offshore | Hyunwoo Industrial vs. Youngbo Chemical Co | Hyunwoo Industrial vs. Youl Chon Chemical |
| Guyoung Technology vs. Lotte Chilsung Beverage | Guyoung Technology vs. DB Insurance Co | Guyoung Technology vs. Kisan Telecom Co | Guyoung Technology vs. Sam Yang Foods |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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