Correlation Between Hyundai and Atacado SA
Can any of the company-specific risk be diversified away by investing in both Hyundai and Atacado SA 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 and Atacado SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor Co and Atacado SA, you can compare the effects of market volatilities on Hyundai and Atacado SA 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 with a short position of Atacado SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Atacado SA.
Diversification Opportunities for Hyundai and Atacado SA
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyundai and Atacado is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Atacado SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atacado SA and Hyundai 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 Motor Co are associated (or correlated) with Atacado SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atacado SA has no effect on the direction of Hyundai i.e., Hyundai and Atacado SA go up and down completely randomly.
Pair Corralation between Hyundai and Atacado SA
Assuming the 90 days horizon Hyundai Motor Co is expected to generate 41.41 times more return on investment than Atacado SA. However, Hyundai is 41.41 times more volatile than Atacado SA. It trades about 0.07 of its potential returns per unit of risk. Atacado SA is currently generating about 0.14 per unit of risk. If you would invest 2,895 in Hyundai Motor Co on September 3, 2024 and sell it today you would earn a total of 2,686 from holding Hyundai Motor Co or generate 92.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 28.89% |
| Values | Daily Returns |
Hyundai Motor Co vs. Atacado SA
Performance |
| Timeline |
| Hyundai Motor |
| Atacado SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Hyundai and Atacado SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Atacado SA
The main advantage of trading using opposite Hyundai and Atacado SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Atacado SA 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 Atacado SA will offset losses from the drop in Atacado SA's long position.| Hyundai vs. Porsche Automobil Holding | Hyundai vs. Porsche Automobile Holding | Hyundai vs. Volkswagen AG 110 | Hyundai vs. Bayerische Motoren Werke |
| Atacado SA vs. Anheuser Busch Inbev | Atacado SA vs. Southwest Airlines | Atacado SA vs. Volaris | Atacado SA vs. Celsius Holdings |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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