Correlation Between Hyundai and Prosiebensat
Can any of the company-specific risk be diversified away by investing in both Hyundai and Prosiebensat 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 Prosiebensat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor and Prosiebensat 1 Media, you can compare the effects of market volatilities on Hyundai and Prosiebensat 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 Prosiebensat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Prosiebensat.
Diversification Opportunities for Hyundai and Prosiebensat
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hyundai and Prosiebensat is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor and Prosiebensat 1 Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prosiebensat 1 Media 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 are associated (or correlated) with Prosiebensat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prosiebensat 1 Media has no effect on the direction of Hyundai i.e., Hyundai and Prosiebensat go up and down completely randomly.
Pair Corralation between Hyundai and Prosiebensat
Assuming the 90 days trading horizon Hyundai Motor is expected to generate 0.99 times more return on investment than Prosiebensat. However, Hyundai Motor is 1.01 times less risky than Prosiebensat. It trades about 0.07 of its potential returns per unit of risk. Prosiebensat 1 Media is currently generating about -0.05 per unit of risk. If you would invest 4,104 in Hyundai Motor on August 29, 2024 and sell it today you would earn a total of 1,556 from holding Hyundai Motor or generate 37.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor vs. Prosiebensat 1 Media
Performance |
| Timeline |
| Hyundai Motor |
| Prosiebensat 1 Media |
Hyundai and Prosiebensat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Prosiebensat
The main advantage of trading using opposite Hyundai and Prosiebensat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Prosiebensat 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 Prosiebensat will offset losses from the drop in Prosiebensat's long position.| Hyundai vs. Ondine Biomedical | Hyundai vs. Europa Metals | Hyundai vs. Lendinvest PLC | Hyundai vs. Neometals |
| Prosiebensat vs. Lendinvest PLC | Prosiebensat vs. Neometals | Prosiebensat vs. Coor Service Management | Prosiebensat vs. Albion Technology General |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |