Correlation Between Hyundai and Gaztransport
Can any of the company-specific risk be diversified away by investing in both Hyundai and Gaztransport 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 Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor and Gaztransport et Technigaz, you can compare the effects of market volatilities on Hyundai and Gaztransport 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 Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Gaztransport.
Diversification Opportunities for Hyundai and Gaztransport
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyundai and Gaztransport is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz 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 Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of Hyundai i.e., Hyundai and Gaztransport go up and down completely randomly.
Pair Corralation between Hyundai and Gaztransport
Assuming the 90 days trading horizon Hyundai Motor is expected to under-perform the Gaztransport. In addition to that, Hyundai is 2.38 times more volatile than Gaztransport et Technigaz. It trades about -0.06 of its total potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.11 per unit of volatility. If you would invest 13,656 in Gaztransport et Technigaz on August 29, 2024 and sell it today you would earn a total of 374.00 from holding Gaztransport et Technigaz or generate 2.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyundai Motor vs. Gaztransport et Technigaz
Performance |
| Timeline |
| Hyundai Motor |
| Gaztransport et Technigaz |
Hyundai and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Gaztransport
The main advantage of trading using opposite Hyundai and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| Hyundai vs. MG Plc | Hyundai vs. Admiral Group PLC | Hyundai vs. Anglo American PLC | Hyundai vs. Vodafone Group PLC |
| Gaztransport vs. BW Offshore | Gaztransport vs. Tyson Foods Cl | Gaztransport vs. Capital Metals PLC | Gaztransport vs. Zoom Video Communications |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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