Correlation Between Hanjoo Light and Hyundai
Can any of the company-specific risk be diversified away by investing in both Hanjoo Light 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 Hanjoo Light and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanjoo Light Metal and Hyundai Motor Co, you can compare the effects of market volatilities on Hanjoo Light 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 Hanjoo Light with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanjoo Light and Hyundai.
Diversification Opportunities for Hanjoo Light and Hyundai
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hanjoo and Hyundai is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Hanjoo Light Metal and Hyundai Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and Hanjoo Light 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 Hanjoo Light Metal 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 Hanjoo Light i.e., Hanjoo Light and Hyundai go up and down completely randomly.
Pair Corralation between Hanjoo Light and Hyundai
Assuming the 90 days trading horizon Hanjoo Light Metal is expected to under-perform the Hyundai. In addition to that, Hanjoo Light is 1.5 times more volatile than Hyundai Motor Co. It trades about -0.03 of its total potential returns per unit of risk. Hyundai Motor Co is currently generating about -0.04 per unit of volatility. If you would invest 16,190,000 in Hyundai Motor Co on October 28, 2024 and sell it today you would lose (490,000) from holding Hyundai Motor Co or give up 3.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanjoo Light Metal vs. Hyundai Motor Co
Performance |
| Timeline |
| Hanjoo Light Metal |
| Hyundai Motor |
Hanjoo Light and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanjoo Light and Hyundai
The main advantage of trading using opposite Hanjoo Light and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanjoo Light 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.| Hanjoo Light vs. Samsung Electronics Co | Hanjoo Light vs. Samsung Electronics Co | Hanjoo Light vs. LG Energy Solution | Hanjoo Light vs. SK Hynix |
| Hyundai vs. Hyundai Motor Co | Hyundai vs. Home Center Holdings | Hyundai vs. KPX Green Chemical | Hyundai vs. Dgb Financial |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA |