Correlation Between Hyosung Advanced and Formetal
Can any of the company-specific risk be diversified away by investing in both Hyosung Advanced and Formetal 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 Formetal 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 Formetal Co, you can compare the effects of market volatilities on Hyosung Advanced and Formetal 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 Formetal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyosung Advanced and Formetal.
Diversification Opportunities for Hyosung Advanced and Formetal
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyosung and Formetal is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Hyosung Advanced Materials and Formetal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Formetal 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 Formetal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Formetal has no effect on the direction of Hyosung Advanced i.e., Hyosung Advanced and Formetal go up and down completely randomly.
Pair Corralation between Hyosung Advanced and Formetal
Assuming the 90 days trading horizon Hyosung Advanced is expected to generate 9.93 times less return on investment than Formetal. But when comparing it to its historical volatility, Hyosung Advanced Materials is 2.09 times less risky than Formetal. It trades about 0.07 of its potential returns per unit of risk. Formetal Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 300,000 in Formetal Co on October 30, 2024 and sell it today you would earn a total of 80,500 from holding Formetal Co or generate 26.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyosung Advanced Materials vs. Formetal Co
Performance |
| Timeline |
| Hyosung Advanced Mat |
| Formetal |
Hyosung Advanced and Formetal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyosung Advanced and Formetal
The main advantage of trading using opposite Hyosung Advanced and Formetal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyosung Advanced position performs unexpectedly, Formetal 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 Formetal will offset losses from the drop in Formetal's long position.| Hyosung Advanced vs. Guyoung Technology Co | Hyosung Advanced vs. Daishin Information Communications | Hyosung Advanced vs. Dongbang Transport Logistics | Hyosung Advanced vs. Automobile Pc |
| Formetal vs. Shinhan Financial Group | Formetal vs. Golden Bridge Investment | Formetal vs. Jeju Bank | Formetal vs. DB Financial Investment |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |