Correlation Between Hyundai Green and SK Telecom
Can any of the company-specific risk be diversified away by investing in both Hyundai Green and SK Telecom 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 Hyundai Green and SK Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Green Food and SK Telecom Co, you can compare the effects of market volatilities on Hyundai Green and SK Telecom 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 Hyundai Green with a short position of SK Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Green and SK Telecom.
Diversification Opportunities for Hyundai Green and SK Telecom
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyundai and 017670 is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Green Food and SK Telecom Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Telecom and Hyundai Green 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 Hyundai Green Food are associated (or correlated) with SK Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Telecom has no effect on the direction of Hyundai Green i.e., Hyundai Green and SK Telecom go up and down completely randomly.
Pair Corralation between Hyundai Green and SK Telecom
Assuming the 90 days trading horizon Hyundai Green Food is expected to generate 1.53 times more return on investment than SK Telecom. However, Hyundai Green is 1.53 times more volatile than SK Telecom Co. It trades about 0.39 of its potential returns per unit of risk. SK Telecom Co is currently generating about 0.0 per unit of risk. If you would invest 1,164,000 in Hyundai Green Food on August 27, 2024 and sell it today you would earn a total of 149,000 from holding Hyundai Green Food or generate 12.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Green Food vs. SK Telecom Co
Performance |
| Timeline |
| Hyundai Green Food |
| SK Telecom |
Hyundai Green and SK Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Green and SK Telecom
The main advantage of trading using opposite Hyundai Green and SK Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Green position performs unexpectedly, SK Telecom 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 SK Telecom will offset losses from the drop in SK Telecom's long position.| Hyundai Green vs. Samsung Electronics Co | Hyundai Green vs. Samsung Electronics Co | Hyundai Green vs. LG Energy Solution | Hyundai Green vs. SK Hynix |
| SK Telecom vs. AfreecaTV Co | SK Telecom vs. SS TECH | SK Telecom vs. Busan Industrial Co | SK Telecom vs. Busan Ind |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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