Correlation Between Hyunwoo Industrial and Sewoon Medical
Can any of the company-specific risk be diversified away by investing in both Hyunwoo Industrial and Sewoon Medical 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 Sewoon Medical 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 Sewoon Medical Co, you can compare the effects of market volatilities on Hyunwoo Industrial and Sewoon Medical 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 Sewoon Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyunwoo Industrial and Sewoon Medical.
Diversification Opportunities for Hyunwoo Industrial and Sewoon Medical
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyunwoo and Sewoon is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Hyunwoo Industrial Co and Sewoon Medical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sewoon Medical 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 Sewoon Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sewoon Medical has no effect on the direction of Hyunwoo Industrial i.e., Hyunwoo Industrial and Sewoon Medical go up and down completely randomly.
Pair Corralation between Hyunwoo Industrial and Sewoon Medical
Assuming the 90 days trading horizon Hyunwoo Industrial Co is expected to generate 1.48 times more return on investment than Sewoon Medical. However, Hyunwoo Industrial is 1.48 times more volatile than Sewoon Medical Co. It trades about 0.1 of its potential returns per unit of risk. Sewoon Medical Co is currently generating about -0.07 per unit of risk. If you would invest 254,000 in Hyunwoo Industrial Co on November 3, 2024 and sell it today you would earn a total of 8,500 from holding Hyunwoo Industrial Co or generate 3.35% 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. Sewoon Medical Co
Performance |
| Timeline |
| Hyunwoo Industrial |
| Sewoon Medical |
Hyunwoo Industrial and Sewoon Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyunwoo Industrial and Sewoon Medical
The main advantage of trading using opposite Hyunwoo Industrial and Sewoon Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyunwoo Industrial position performs unexpectedly, Sewoon Medical 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 Sewoon Medical will offset losses from the drop in Sewoon Medical's long position.| Hyunwoo Industrial vs. Koryo Credit Information | Hyunwoo Industrial vs. DB Financial Investment | Hyunwoo Industrial vs. PLAYWITH | Hyunwoo Industrial vs. Pureun Mutual Savings |
| Sewoon Medical vs. Nh Investment And | Sewoon Medical vs. Husteel | Sewoon Medical vs. SV Investment | Sewoon Medical vs. Finebesteel |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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