Correlation Between DC Media and Hyundai
Can any of the company-specific risk be diversified away by investing in both DC Media 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 DC Media and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DC Media Co and Hyundai Motor Co, you can compare the effects of market volatilities on DC Media 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 DC Media with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of DC Media and Hyundai.
Diversification Opportunities for DC Media and Hyundai
Very good diversification
The 3 months correlation between 263720 and Hyundai is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding DC Media Co and Hyundai Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and DC Media 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 DC Media Co 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 DC Media i.e., DC Media and Hyundai go up and down completely randomly.
Pair Corralation between DC Media and Hyundai
Assuming the 90 days trading horizon DC Media is expected to generate 3.12 times less return on investment than Hyundai. In addition to that, DC Media is 2.13 times more volatile than Hyundai Motor Co. It trades about 0.01 of its total potential returns per unit of risk. Hyundai Motor Co is currently generating about 0.08 per unit of volatility. If you would invest 8,471,439 in Hyundai Motor Co on October 29, 2024 and sell it today you would earn a total of 7,638,561 from holding Hyundai Motor Co or generate 90.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DC Media Co vs. Hyundai Motor Co
Performance |
| Timeline |
| DC Media |
| Hyundai Motor |
DC Media and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DC Media and Hyundai
The main advantage of trading using opposite DC Media and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DC Media 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.| DC Media vs. Samsung Special Purpose | DC Media vs. Busan Industrial Co | DC Media vs. Busan Ind | DC Media vs. Shinhan WTI Futures |
| Hyundai vs. Innowireless Co | Hyundai vs. LG Household Healthcare | Hyundai vs. SEOWONINTECHCoLtd | Hyundai vs. FNSTech 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |