Correlation Between Hyundai and Exelixis
Can any of the company-specific risk be diversified away by investing in both Hyundai and Exelixis 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 Exelixis 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 Exelixis, you can compare the effects of market volatilities on Hyundai and Exelixis 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 Exelixis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Exelixis.
Diversification Opportunities for Hyundai and Exelixis
Pay attention - limited upside
The 3 months correlation between Hyundai and Exelixis is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Exelixis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exelixis 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 Exelixis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exelixis has no effect on the direction of Hyundai i.e., Hyundai and Exelixis go up and down completely randomly.
Pair Corralation between Hyundai and Exelixis
Assuming the 90 days horizon Hyundai is expected to generate 1.02 times less return on investment than Exelixis. In addition to that, Hyundai is 1.29 times more volatile than Exelixis. It trades about 0.07 of its total potential returns per unit of risk. Exelixis is currently generating about 0.09 per unit of volatility. If you would invest 1,667 in Exelixis on August 27, 2024 and sell it today you would earn a total of 1,894 from holding Exelixis or generate 113.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. Exelixis
Performance |
| Timeline |
| Hyundai Motor |
| Exelixis |
Hyundai and Exelixis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Exelixis
The main advantage of trading using opposite Hyundai and Exelixis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Exelixis 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 Exelixis will offset losses from the drop in Exelixis' long position.| Hyundai vs. Isuzu Motors | Hyundai vs. Renault SA | Hyundai vs. Toyota Motor Corp | Hyundai vs. Porsche Automobile Holding |
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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 Stocks Directory module to find actively traded stocks across global markets.
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