Correlation Between Hyunwoo Industrial and Okins Electronics
Can any of the company-specific risk be diversified away by investing in both Hyunwoo Industrial and Okins Electronics 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 Okins Electronics 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 Okins Electronics Co, you can compare the effects of market volatilities on Hyunwoo Industrial and Okins Electronics 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 Okins Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyunwoo Industrial and Okins Electronics.
Diversification Opportunities for Hyunwoo Industrial and Okins Electronics
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyunwoo and Okins is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Hyunwoo Industrial Co and Okins Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okins Electronics 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 Okins Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okins Electronics has no effect on the direction of Hyunwoo Industrial i.e., Hyunwoo Industrial and Okins Electronics go up and down completely randomly.
Pair Corralation between Hyunwoo Industrial and Okins Electronics
Assuming the 90 days trading horizon Hyunwoo Industrial Co is expected to generate 1.17 times more return on investment than Okins Electronics. However, Hyunwoo Industrial is 1.17 times more volatile than Okins Electronics Co. It trades about -0.14 of its potential returns per unit of risk. Okins Electronics Co is currently generating about -0.54 per unit of risk. If you would invest 283,000 in Hyunwoo Industrial Co on August 28, 2024 and sell it today you would lose (20,000) from holding Hyunwoo Industrial Co or give up 7.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyunwoo Industrial Co vs. Okins Electronics Co
Performance |
| Timeline |
| Hyunwoo Industrial |
| Okins Electronics |
Hyunwoo Industrial and Okins Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyunwoo Industrial and Okins Electronics
The main advantage of trading using opposite Hyunwoo Industrial and Okins Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyunwoo Industrial position performs unexpectedly, Okins Electronics 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 Okins Electronics will offset losses from the drop in Okins Electronics' long position.| Hyunwoo Industrial vs. SK Hynix | Hyunwoo Industrial vs. People Technology | Hyunwoo Industrial vs. SIMMTECH Co | Hyunwoo Industrial vs. Haesung DS Co |
| Okins Electronics vs. Korea Real Estate | Okins Electronics vs. Korea Ratings Co | Okins Electronics vs. IQuest Co | Okins Electronics vs. Wonbang Tech 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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