Correlation Between Hyundai and Altamira Therapeutics
Can any of the company-specific risk be diversified away by investing in both Hyundai and Altamira Therapeutics 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 Altamira Therapeutics 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 Altamira Therapeutics, you can compare the effects of market volatilities on Hyundai and Altamira Therapeutics 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 Altamira Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Altamira Therapeutics.
Diversification Opportunities for Hyundai and Altamira Therapeutics
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyundai and Altamira is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Altamira Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altamira Therapeutics 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 Altamira Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altamira Therapeutics has no effect on the direction of Hyundai i.e., Hyundai and Altamira Therapeutics go up and down completely randomly.
Pair Corralation between Hyundai and Altamira Therapeutics
Assuming the 90 days horizon Hyundai Motor Co is expected to generate 0.41 times more return on investment than Altamira Therapeutics. However, Hyundai Motor Co is 2.46 times less risky than Altamira Therapeutics. It trades about -0.05 of its potential returns per unit of risk. Altamira Therapeutics is currently generating about -0.16 per unit of risk. If you would invest 5,834 in Hyundai Motor Co on August 31, 2024 and sell it today you would lose (134.00) from holding Hyundai Motor Co or give up 2.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. Altamira Therapeutics
Performance |
| Timeline |
| Hyundai Motor |
| Altamira Therapeutics |
Hyundai and Altamira Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Altamira Therapeutics
The main advantage of trading using opposite Hyundai and Altamira Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Altamira Therapeutics 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 Altamira Therapeutics will offset losses from the drop in Altamira Therapeutics' long position.The idea behind Hyundai Motor Co and Altamira Therapeutics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Altamira Therapeutics vs. Pyxis Oncology | Altamira Therapeutics vs. Zura Bio Limited | Altamira Therapeutics vs. Elevation Oncology | Altamira Therapeutics vs. Immix Biopharma |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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