Correlation Between Hurum and LG Display
Can any of the company-specific risk be diversified away by investing in both Hurum and LG Display 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 Hurum and LG Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hurum Co and LG Display, you can compare the effects of market volatilities on Hurum and LG Display 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 Hurum with a short position of LG Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurum and LG Display.
Diversification Opportunities for Hurum and LG Display
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hurum and 034220 is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hurum Co and LG Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Display and Hurum 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 Hurum Co are associated (or correlated) with LG Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Display has no effect on the direction of Hurum i.e., Hurum and LG Display go up and down completely randomly.
Pair Corralation between Hurum and LG Display
Assuming the 90 days trading horizon Hurum Co is expected to under-perform the LG Display. In addition to that, Hurum is 1.01 times more volatile than LG Display. It trades about -0.1 of its total potential returns per unit of risk. LG Display is currently generating about -0.01 per unit of volatility. If you would invest 1,033,000 in LG Display on September 1, 2024 and sell it today you would lose (85,000) from holding LG Display or give up 8.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hurum Co vs. LG Display
Performance |
| Timeline |
| Hurum |
| LG Display |
Hurum and LG Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hurum and LG Display
The main advantage of trading using opposite Hurum and LG Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hurum position performs unexpectedly, LG Display 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 LG Display will offset losses from the drop in LG Display's long position.| Hurum vs. Cube Entertainment | Hurum vs. Koh Young Technology | Hurum vs. NewFlex Technology Co | Hurum vs. T3 Entertainment Co |
| LG Display vs. Dongsin Engineering Construction | LG Display vs. Doosan Fuel Cell | LG Display vs. Daishin Balance 1 | LG Display vs. Total Soft Bank |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |