Correlation Between Hyundai Green and SK Holdings
Can any of the company-specific risk be diversified away by investing in both Hyundai Green and SK Holdings 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 Holdings 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 Holdings Co, you can compare the effects of market volatilities on Hyundai Green and SK Holdings 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 Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai Green and SK Holdings.
Diversification Opportunities for Hyundai Green and SK Holdings
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyundai and 034730 is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Green Food and SK Holdings Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SK Holdings 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 Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SK Holdings has no effect on the direction of Hyundai Green i.e., Hyundai Green and SK Holdings go up and down completely randomly.
Pair Corralation between Hyundai Green and SK Holdings
Assuming the 90 days trading horizon Hyundai Green Food is expected to under-perform the SK Holdings. In addition to that, Hyundai Green is 1.02 times more volatile than SK Holdings Co. It trades about -0.03 of its total potential returns per unit of risk. SK Holdings Co is currently generating about 0.39 per unit of volatility. If you would invest 13,200,000 in SK Holdings Co on November 1, 2024 and sell it today you would earn a total of 1,650,000 from holding SK Holdings Co or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Green Food vs. SK Holdings Co
Performance |
| Timeline |
| Hyundai Green Food |
| SK Holdings |
Hyundai Green and SK Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai Green and SK Holdings
The main advantage of trading using opposite Hyundai Green and SK Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai Green position performs unexpectedly, SK Holdings 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 Holdings will offset losses from the drop in SK Holdings' long position.| Hyundai Green vs. Daiyang Metal Co | Hyundai Green vs. Dongbang Transport Logistics | Hyundai Green vs. ADTechnology CoLtd | Hyundai Green vs. RFTech Co |
| SK Holdings vs. SKONEC Entertainment Co | SK Holdings vs. SAMG Entertainment Co | SK Holdings vs. Daewon Media Co | SK Holdings vs. Hyundai Green Food |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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