Correlation Between Genertec Universal and Hyundai
Can any of the company-specific risk be diversified away by investing in both Genertec Universal and Hyundai 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 Genertec Universal and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genertec Universal Medical and Hyundai Motor, you can compare the effects of market volatilities on Genertec Universal and Hyundai 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 Genertec Universal with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genertec Universal and Hyundai.
Diversification Opportunities for Genertec Universal and Hyundai
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Genertec and Hyundai is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Genertec Universal Medical and Hyundai Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and Genertec Universal 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 Genertec Universal Medical are associated (or correlated) with Hyundai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Motor has no effect on the direction of Genertec Universal i.e., Genertec Universal and Hyundai go up and down completely randomly.
Pair Corralation between Genertec Universal and Hyundai
Assuming the 90 days horizon Genertec Universal is expected to generate 3.63 times less return on investment than Hyundai. In addition to that, Genertec Universal is 1.29 times more volatile than Hyundai Motor. It trades about 0.01 of its total potential returns per unit of risk. Hyundai Motor is currently generating about 0.07 per unit of volatility. If you would invest 2,639 in Hyundai Motor on October 14, 2024 and sell it today you would earn a total of 2,211 from holding Hyundai Motor or generate 83.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.81% |
| Values | Daily Returns |
Genertec Universal Medical vs. Hyundai Motor
Performance |
| Timeline |
| Genertec Universal |
| Hyundai Motor |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Genertec Universal and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genertec Universal and Hyundai
The main advantage of trading using opposite Genertec Universal and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genertec Universal position performs unexpectedly, Hyundai 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 will offset losses from the drop in Hyundai's long position.| Genertec Universal vs. Veeva Systems | Genertec Universal vs. 10X GENOMICS DL | Genertec Universal vs. Healthequity | Genertec Universal vs. Teladoc |
| Hyundai vs. JAPAN AIRLINES | Hyundai vs. ONWARD MEDICAL BV | Hyundai vs. Advanced Medical Solutions | Hyundai vs. Genertec Universal Medical |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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