Correlation Between SK Bioscience and Hyundai Industrial
Can any of the company-specific risk be diversified away by investing in both SK Bioscience and Hyundai Industrial 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 SK Bioscience and Hyundai Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Bioscience Co and Hyundai Industrial Co, you can compare the effects of market volatilities on SK Bioscience and Hyundai Industrial 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 SK Bioscience with a short position of Hyundai Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Bioscience and Hyundai Industrial.
Diversification Opportunities for SK Bioscience and Hyundai Industrial
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between 302440 and Hyundai is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding SK Bioscience Co and Hyundai Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Industrial and SK Bioscience 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 SK Bioscience Co are associated (or correlated) with Hyundai Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Industrial has no effect on the direction of SK Bioscience i.e., SK Bioscience and Hyundai Industrial go up and down completely randomly.
Pair Corralation between SK Bioscience and Hyundai Industrial
Assuming the 90 days trading horizon SK Bioscience Co is expected to under-perform the Hyundai Industrial. But the stock apears to be less risky and, when comparing its historical volatility, SK Bioscience Co is 2.24 times less risky than Hyundai Industrial. The stock trades about -0.07 of its potential returns per unit of risk. The Hyundai Industrial Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 502,000 in Hyundai Industrial Co on November 27, 2024 and sell it today you would earn a total of 104,000 from holding Hyundai Industrial Co or generate 20.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Bioscience Co vs. Hyundai Industrial Co
Performance |
| Timeline |
| SK Bioscience |
| Hyundai Industrial |
SK Bioscience and Hyundai Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Bioscience and Hyundai Industrial
The main advantage of trading using opposite SK Bioscience and Hyundai Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Bioscience position performs unexpectedly, Hyundai Industrial 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 Hyundai Industrial will offset losses from the drop in Hyundai Industrial's long position.| SK Bioscience vs. Kyeryong Construction Industrial | SK Bioscience vs. SBI Investment KOREA | SK Bioscience vs. Pureun Mutual Savings | SK Bioscience vs. PJ Metal Co |
| Hyundai Industrial vs. Kukil Metal Co | Hyundai Industrial vs. Ssangyong Materials Corp | Hyundai Industrial vs. Daejung Chemicals Metals | Hyundai Industrial vs. Seoyon Topmetal 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Stocks Directory Find actively traded stocks across global markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |