Correlation Between Hyundai and Vir Biotechnology
Can any of the company-specific risk be diversified away by investing in both Hyundai and Vir Biotechnology 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 Vir Biotechnology 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 Vir Biotechnology, you can compare the effects of market volatilities on Hyundai and Vir Biotechnology 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 Vir Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Vir Biotechnology.
Diversification Opportunities for Hyundai and Vir Biotechnology
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyundai and Vir is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor Co and Vir Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vir Biotechnology 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 Vir Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vir Biotechnology has no effect on the direction of Hyundai i.e., Hyundai and Vir Biotechnology go up and down completely randomly.
Pair Corralation between Hyundai and Vir Biotechnology
Assuming the 90 days horizon Hyundai Motor Co is expected to generate 0.61 times more return on investment than Vir Biotechnology. However, Hyundai Motor Co is 1.64 times less risky than Vir Biotechnology. It trades about 0.07 of its potential returns per unit of risk. Vir Biotechnology is currently generating about -0.04 per unit of risk. If you would invest 2,746 in Hyundai Motor Co on August 30, 2024 and sell it today you would earn a total of 3,012 from holding Hyundai Motor Co or generate 109.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor Co vs. Vir Biotechnology
Performance |
| Timeline |
| Hyundai Motor |
| Vir Biotechnology |
Hyundai and Vir Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Vir Biotechnology
The main advantage of trading using opposite Hyundai and Vir Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Vir Biotechnology 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 Vir Biotechnology will offset losses from the drop in Vir Biotechnology's long position.| Hyundai vs. Buhler Industries | Hyundai vs. AmeraMex International | Hyundai vs. Textainer Group Holdings | Hyundai vs. Deere Company |
| Vir Biotechnology vs. CureVac NV | Vir Biotechnology vs. Krystal Biotech | Vir Biotechnology vs. Propanc Biopharma | Vir Biotechnology vs. Blueprint Medicines Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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