Correlation Between Puloon Technology and Hyundai
Can any of the company-specific risk be diversified away by investing in both Puloon Technology and Hyundai 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 Puloon Technology and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puloon Technology and Hyundai Motor Co, you can compare the effects of market volatilities on Puloon Technology and Hyundai 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 Puloon Technology with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puloon Technology and Hyundai.
Diversification Opportunities for Puloon Technology and Hyundai
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Puloon and Hyundai is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Puloon Technology and Hyundai Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and Puloon Technology 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 Puloon Technology are associated (or correlated) with Hyundai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Motor has no effect on the direction of Puloon Technology i.e., Puloon Technology and Hyundai go up and down completely randomly.
Pair Corralation between Puloon Technology and Hyundai
Assuming the 90 days trading horizon Puloon Technology is expected to generate 2.13 times more return on investment than Hyundai. However, Puloon Technology is 2.13 times more volatile than Hyundai Motor Co. It trades about 0.18 of its potential returns per unit of risk. Hyundai Motor Co is currently generating about 0.1 per unit of risk. If you would invest 682,000 in Puloon Technology on October 13, 2024 and sell it today you would earn a total of 64,000 from holding Puloon Technology or generate 9.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Puloon Technology vs. Hyundai Motor Co
Performance |
| Timeline |
| Puloon Technology |
| Hyundai Motor |
Puloon Technology and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puloon Technology and Hyundai
The main advantage of trading using opposite Puloon Technology and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puloon Technology position performs unexpectedly, Hyundai 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 Hyundai will offset losses from the drop in Hyundai's long position.| Puloon Technology vs. KMH Hitech Co | Puloon Technology vs. GemVaxKAEL CoLtd | Puloon Technology vs. Bosung Power Technology | Puloon Technology vs. Busan Industrial Co |
| Hyundai vs. Youngbo Chemical Co | Hyundai vs. Digital Power Communications | Hyundai vs. ECSTELECOM Co | Hyundai vs. Lotte Data Communication |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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