Correlation Between Puloon Technology and Hyosung Chemical
Can any of the company-specific risk be diversified away by investing in both Puloon Technology and Hyosung Chemical 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 Hyosung Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puloon Technology and Hyosung Chemical Corp, you can compare the effects of market volatilities on Puloon Technology and Hyosung Chemical 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 Hyosung Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puloon Technology and Hyosung Chemical.
Diversification Opportunities for Puloon Technology and Hyosung Chemical
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Puloon and Hyosung is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Puloon Technology and Hyosung Chemical Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyosung Chemical Corp 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 Hyosung Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyosung Chemical Corp has no effect on the direction of Puloon Technology i.e., Puloon Technology and Hyosung Chemical go up and down completely randomly.
Pair Corralation between Puloon Technology and Hyosung Chemical
Assuming the 90 days trading horizon Puloon Technology is expected to generate 0.97 times more return on investment than Hyosung Chemical. However, Puloon Technology is 1.03 times less risky than Hyosung Chemical. It trades about -0.07 of its potential returns per unit of risk. Hyosung Chemical Corp is currently generating about -0.45 per unit of risk. If you would invest 628,000 in Puloon Technology on August 28, 2024 and sell it today you would lose (25,000) from holding Puloon Technology or give up 3.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Puloon Technology vs. Hyosung Chemical Corp
Performance |
| Timeline |
| Puloon Technology |
| Hyosung Chemical Corp |
Puloon Technology and Hyosung Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puloon Technology and Hyosung Chemical
The main advantage of trading using opposite Puloon Technology and Hyosung Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puloon Technology position performs unexpectedly, Hyosung Chemical 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 Hyosung Chemical will offset losses from the drop in Hyosung Chemical's long position.| Puloon Technology vs. Seoul Food Industrial | Puloon Technology vs. MetaLabs Co | Puloon Technology vs. Busan Industrial Co | Puloon Technology vs. Formetal Co |
| Hyosung Chemical vs. System and Application | Hyosung Chemical vs. Korea Computer | Hyosung Chemical vs. Shinsegae Information Communication | Hyosung Chemical vs. Ssangyong Information 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |