Correlation Between Hyosung Advanced and HyVision System
Can any of the company-specific risk be diversified away by investing in both Hyosung Advanced and HyVision System 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 HyVision System 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 HyVision System, you can compare the effects of market volatilities on Hyosung Advanced and HyVision System 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 HyVision System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyosung Advanced and HyVision System.
Diversification Opportunities for Hyosung Advanced and HyVision System
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyosung and HyVision is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Hyosung Advanced Materials and HyVision System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HyVision System 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 HyVision System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HyVision System has no effect on the direction of Hyosung Advanced i.e., Hyosung Advanced and HyVision System go up and down completely randomly.
Pair Corralation between Hyosung Advanced and HyVision System
Assuming the 90 days trading horizon Hyosung Advanced is expected to generate 3.72 times less return on investment than HyVision System. In addition to that, Hyosung Advanced is 1.09 times more volatile than HyVision System. It trades about 0.07 of its total potential returns per unit of risk. HyVision System is currently generating about 0.29 per unit of volatility. If you would invest 1,434,000 in HyVision System on September 15, 2024 and sell it today you would earn a total of 311,000 from holding HyVision System or generate 21.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyosung Advanced Materials vs. HyVision System
Performance |
| Timeline |
| Hyosung Advanced Mat |
| HyVision System |
Hyosung Advanced and HyVision System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyosung Advanced and HyVision System
The main advantage of trading using opposite Hyosung Advanced and HyVision System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyosung Advanced position performs unexpectedly, HyVision System 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 HyVision System will offset losses from the drop in HyVision System's long position.| Hyosung Advanced vs. Solution Advanced Technology | Hyosung Advanced vs. Busan Industrial Co | Hyosung Advanced vs. Busan Ind | Hyosung Advanced vs. Sam Chun Dang |
| HyVision System vs. Hyosung Advanced Materials | HyVision System vs. Foodnamoo | HyVision System vs. Sempio Foods Co | HyVision System vs. FOODWELL 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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