Correlation Between Hyosung Advanced and RFTech
Can any of the company-specific risk be diversified away by investing in both Hyosung Advanced and RFTech 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 Hyosung Advanced and RFTech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyosung Advanced Materials and RFTech Co, you can compare the effects of market volatilities on Hyosung Advanced and RFTech 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 Hyosung Advanced with a short position of RFTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyosung Advanced and RFTech.
Diversification Opportunities for Hyosung Advanced and RFTech
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyosung and RFTech is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hyosung Advanced Materials and RFTech Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RFTech and Hyosung Advanced 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 Hyosung Advanced Materials are associated (or correlated) with RFTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RFTech has no effect on the direction of Hyosung Advanced i.e., Hyosung Advanced and RFTech go up and down completely randomly.
Pair Corralation between Hyosung Advanced and RFTech
Assuming the 90 days trading horizon Hyosung Advanced Materials is expected to generate 1.13 times more return on investment than RFTech. However, Hyosung Advanced is 1.13 times more volatile than RFTech Co. It trades about 0.07 of its potential returns per unit of risk. RFTech Co is currently generating about -0.15 per unit of risk. If you would invest 17,460,000 in Hyosung Advanced Materials on October 29, 2024 and sell it today you would earn a total of 390,000 from holding Hyosung Advanced Materials or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyosung Advanced Materials vs. RFTech Co
Performance |
| Timeline |
| Hyosung Advanced Mat |
| RFTech |
Hyosung Advanced and RFTech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyosung Advanced and RFTech
The main advantage of trading using opposite Hyosung Advanced and RFTech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyosung Advanced position performs unexpectedly, RFTech 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 RFTech will offset losses from the drop in RFTech's long position.| Hyosung Advanced vs. Eagon Industrial Co | Hyosung Advanced vs. Nable Communications | Hyosung Advanced vs. Pyung Hwa Industrial | Hyosung Advanced vs. LEENO Industrial |
| RFTech vs. Daol Investment Securities | RFTech vs. Dongnam Chemical Co | RFTech vs. KTB Investment Securities | RFTech vs. Korea Petro Chemical |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |