Correlation Between Hyundai Heavy and Mirae Asset
Can any of the company-specific risk be diversified away by investing in both Hyundai Heavy and Mirae Asset 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 Hyundai Heavy and Mirae Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Heavy Industries and Mirae Asset Daewoo, you can compare the effects of market volatilities on Hyundai Heavy and Mirae Asset 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 Hyundai Heavy with a short position of Mirae Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Heavy and Mirae Asset.
Diversification Opportunities for Hyundai Heavy and Mirae Asset
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyundai and Mirae is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Heavy Industries and Mirae Asset Daewoo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirae Asset Daewoo and Hyundai Heavy 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 Hyundai Heavy Industries are associated (or correlated) with Mirae Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirae Asset Daewoo has no effect on the direction of Hyundai Heavy i.e., Hyundai Heavy and Mirae Asset go up and down completely randomly.
Pair Corralation between Hyundai Heavy and Mirae Asset
Assuming the 90 days trading horizon Hyundai Heavy Industries is expected to generate 1.7 times more return on investment than Mirae Asset. However, Hyundai Heavy is 1.7 times more volatile than Mirae Asset Daewoo. It trades about 0.12 of its potential returns per unit of risk. Mirae Asset Daewoo is currently generating about -0.01 per unit of risk. If you would invest 7,780,000 in Hyundai Heavy Industries on October 30, 2024 and sell it today you would earn a total of 660,000 from holding Hyundai Heavy Industries or generate 8.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Heavy Industries vs. Mirae Asset Daewoo
Performance |
| Timeline |
| Hyundai Heavy Industries |
| Mirae Asset Daewoo |
Hyundai Heavy and Mirae Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Heavy and Mirae Asset
The main advantage of trading using opposite Hyundai Heavy and Mirae Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Heavy position performs unexpectedly, Mirae Asset 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 Mirae Asset will offset losses from the drop in Mirae Asset's long position.| Hyundai Heavy vs. SS TECH | Hyundai Heavy vs. Wireless Power Amplifier | Hyundai Heavy vs. Homecast CoLtd | Hyundai Heavy vs. V One Tech Co |
| Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. Samsung Electronics Co | Mirae Asset vs. LG Energy Solution | Mirae Asset vs. SK Hynix |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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