Correlation Between WooDeumGee Farm and HYUNDAI BIOLAND
Can any of the company-specific risk be diversified away by investing in both WooDeumGee Farm and HYUNDAI BIOLAND 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 WooDeumGee Farm and HYUNDAI BIOLAND into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WooDeumGee Farm Co, and HYUNDAI BIOLAND CoLtd, you can compare the effects of market volatilities on WooDeumGee Farm and HYUNDAI BIOLAND 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 WooDeumGee Farm with a short position of HYUNDAI BIOLAND. Check out your portfolio center. Please also check ongoing floating volatility patterns of WooDeumGee Farm and HYUNDAI BIOLAND.
Diversification Opportunities for WooDeumGee Farm and HYUNDAI BIOLAND
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between WooDeumGee and HYUNDAI is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding WooDeumGee Farm Co, and HYUNDAI BIOLAND CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HYUNDAI BIOLAND CoLtd and WooDeumGee Farm 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 WooDeumGee Farm Co, are associated (or correlated) with HYUNDAI BIOLAND. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HYUNDAI BIOLAND CoLtd has no effect on the direction of WooDeumGee Farm i.e., WooDeumGee Farm and HYUNDAI BIOLAND go up and down completely randomly.
Pair Corralation between WooDeumGee Farm and HYUNDAI BIOLAND
Assuming the 90 days trading horizon WooDeumGee Farm Co, is expected to under-perform the HYUNDAI BIOLAND. In addition to that, WooDeumGee Farm is 1.7 times more volatile than HYUNDAI BIOLAND CoLtd. It trades about -0.03 of its total potential returns per unit of risk. HYUNDAI BIOLAND CoLtd is currently generating about -0.02 per unit of volatility. If you would invest 647,066 in HYUNDAI BIOLAND CoLtd on September 14, 2024 and sell it today you would lose (219,566) from holding HYUNDAI BIOLAND CoLtd or give up 33.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 61.9% |
| Values | Daily Returns |
WooDeumGee Farm Co, vs. HYUNDAI BIOLAND CoLtd
Performance |
| Timeline |
| WooDeumGee Farm Co, |
| HYUNDAI BIOLAND CoLtd |
WooDeumGee Farm and HYUNDAI BIOLAND Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WooDeumGee Farm and HYUNDAI BIOLAND
The main advantage of trading using opposite WooDeumGee Farm and HYUNDAI BIOLAND positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WooDeumGee Farm position performs unexpectedly, HYUNDAI BIOLAND 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 BIOLAND will offset losses from the drop in HYUNDAI BIOLAND's long position.| WooDeumGee Farm vs. Samsung Electronics Co | WooDeumGee Farm vs. Samsung Electronics Co | WooDeumGee Farm vs. LG Energy Solution | WooDeumGee Farm vs. SK Hynix |
| HYUNDAI BIOLAND vs. LG Household Healthcare | HYUNDAI BIOLAND vs. Sungdo Engineering Construction | HYUNDAI BIOLAND vs. WooDeumGee Farm Co, | HYUNDAI BIOLAND vs. Aprogen Healthcare Games |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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