Correlation Between Genuit Group and Hyundai
Can any of the company-specific risk be diversified away by investing in both Genuit Group 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 Genuit Group and Hyundai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genuit Group plc and Hyundai Motor, you can compare the effects of market volatilities on Genuit Group 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 Genuit Group with a short position of Hyundai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genuit Group and Hyundai.
Diversification Opportunities for Genuit Group and Hyundai
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Genuit and Hyundai is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Genuit Group plc and Hyundai Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Motor and Genuit Group 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 Genuit Group plc 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 Genuit Group i.e., Genuit Group and Hyundai go up and down completely randomly.
Pair Corralation between Genuit Group and Hyundai
Assuming the 90 days trading horizon Genuit Group plc is expected to under-perform the Hyundai. But the stock apears to be less risky and, when comparing its historical volatility, Genuit Group plc is 1.16 times less risky than Hyundai. The stock trades about -0.21 of its potential returns per unit of risk. The Hyundai Motor is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 5,500 in Hyundai Motor on September 12, 2024 and sell it today you would lose (260.00) from holding Hyundai Motor or give up 4.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genuit Group plc vs. Hyundai Motor
Performance |
| Timeline |
| Genuit Group plc |
| Hyundai Motor |
Genuit Group and Hyundai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genuit Group and Hyundai
The main advantage of trading using opposite Genuit Group and Hyundai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genuit Group 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.| Genuit Group vs. Hong Kong Land | Genuit Group vs. Neometals | Genuit Group vs. Coor Service Management | Genuit Group vs. Fidelity Sustainable USD |
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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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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