Correlation Between Hyunwoo Industrial and Korea Computer
Can any of the company-specific risk be diversified away by investing in both Hyunwoo Industrial and Korea Computer 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 Korea Computer 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 Korea Computer Terminal, you can compare the effects of market volatilities on Hyunwoo Industrial and Korea Computer 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 Korea Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyunwoo Industrial and Korea Computer.
Diversification Opportunities for Hyunwoo Industrial and Korea Computer
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyunwoo and Korea is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Hyunwoo Industrial Co and Korea Computer Terminal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Computer Terminal 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 Korea Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Computer Terminal has no effect on the direction of Hyunwoo Industrial i.e., Hyunwoo Industrial and Korea Computer go up and down completely randomly.
Pair Corralation between Hyunwoo Industrial and Korea Computer
Assuming the 90 days trading horizon Hyunwoo Industrial Co is expected to under-perform the Korea Computer. But the stock apears to be less risky and, when comparing its historical volatility, Hyunwoo Industrial Co is 1.41 times less risky than Korea Computer. The stock trades about -0.09 of its potential returns per unit of risk. The Korea Computer Terminal is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 376,823 in Korea Computer Terminal on September 2, 2024 and sell it today you would lose (133,823) from holding Korea Computer Terminal or give up 35.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyunwoo Industrial Co vs. Korea Computer Terminal
Performance |
| Timeline |
| Hyunwoo Industrial |
| Korea Computer Terminal |
Hyunwoo Industrial and Korea Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyunwoo Industrial and Korea Computer
The main advantage of trading using opposite Hyunwoo Industrial and Korea Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyunwoo Industrial position performs unexpectedly, Korea Computer 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 Korea Computer will offset losses from the drop in Korea Computer's long position.| Hyunwoo Industrial vs. SK Hynix | Hyunwoo Industrial vs. LX Semicon Co | Hyunwoo Industrial vs. People Technology | Hyunwoo Industrial vs. SIMMTECH Co |
| Korea Computer vs. Jeju Semiconductor Corp | Korea Computer vs. Hansol Homedeco Co | Korea Computer vs. HJ ShipBuilding Construction | Korea Computer vs. Seohee Construction 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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