Correlation Between Hyundai Heavy and Fine Besteel
Can any of the company-specific risk be diversified away by investing in both Hyundai Heavy and Fine Besteel 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 Fine Besteel 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 Fine Besteel Co, you can compare the effects of market volatilities on Hyundai Heavy and Fine Besteel 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 Fine Besteel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Heavy and Fine Besteel.
Diversification Opportunities for Hyundai Heavy and Fine Besteel
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyundai and Fine is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Heavy Industries and Fine Besteel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fine Besteel 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 Fine Besteel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fine Besteel has no effect on the direction of Hyundai Heavy i.e., Hyundai Heavy and Fine Besteel go up and down completely randomly.
Pair Corralation between Hyundai Heavy and Fine Besteel
Assuming the 90 days trading horizon Hyundai Heavy Industries is expected to generate 0.64 times more return on investment than Fine Besteel. However, Hyundai Heavy Industries is 1.56 times less risky than Fine Besteel. It trades about 0.05 of its potential returns per unit of risk. Fine Besteel Co is currently generating about -0.04 per unit of risk. If you would invest 5,499,747 in Hyundai Heavy Industries on August 24, 2024 and sell it today you would earn a total of 2,470,253 from holding Hyundai Heavy Industries or generate 44.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Heavy Industries vs. Fine Besteel Co
Performance |
| Timeline |
| Hyundai Heavy Industries |
| Fine Besteel |
Hyundai Heavy and Fine Besteel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Heavy and Fine Besteel
The main advantage of trading using opposite Hyundai Heavy and Fine Besteel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Heavy position performs unexpectedly, Fine Besteel 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 Fine Besteel will offset losses from the drop in Fine Besteel's long position.| Hyundai Heavy vs. Samsung Electronics Co | Hyundai Heavy vs. Samsung Electronics Co | Hyundai Heavy vs. Hyundai Motor Co | Hyundai Heavy vs. Hyundai Motor |
| Fine Besteel vs. AptaBio Therapeutics | Fine Besteel vs. Daewoo SBI SPAC | Fine Besteel vs. Dream Security co | Fine Besteel vs. Microfriend |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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