Correlation Between Hyundai and Hollywood Bowl
Can any of the company-specific risk be diversified away by investing in both Hyundai and Hollywood Bowl 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 Hollywood Bowl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyundai Motor and Hollywood Bowl Group, you can compare the effects of market volatilities on Hyundai and Hollywood Bowl 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 Hollywood Bowl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Hollywood Bowl.
Diversification Opportunities for Hyundai and Hollywood Bowl
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyundai and Hollywood is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor and Hollywood Bowl Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hollywood Bowl Group 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 Hollywood Bowl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hollywood Bowl Group has no effect on the direction of Hyundai i.e., Hyundai and Hollywood Bowl go up and down completely randomly.
Pair Corralation between Hyundai and Hollywood Bowl
Assuming the 90 days trading horizon Hyundai Motor is expected to generate 1.31 times more return on investment than Hollywood Bowl. However, Hyundai is 1.31 times more volatile than Hollywood Bowl Group. It trades about 0.08 of its potential returns per unit of risk. Hollywood Bowl Group is currently generating about 0.07 per unit of risk. If you would invest 2,542 in Hyundai Motor on September 12, 2024 and sell it today you would earn a total of 2,698 from holding Hyundai Motor or generate 106.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Hyundai Motor vs. Hollywood Bowl Group
Performance |
| Timeline |
| Hyundai Motor |
| Hollywood Bowl Group |
Hyundai and Hollywood Bowl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyundai and Hollywood Bowl
The main advantage of trading using opposite Hyundai and Hollywood Bowl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Hollywood Bowl 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 Hollywood Bowl will offset losses from the drop in Hollywood Bowl's long position.| Hyundai vs. Fonix Mobile plc | Hyundai vs. Worldwide Healthcare Trust | Hyundai vs. Omega Healthcare Investors | Hyundai vs. PureTech Health plc |
| Hollywood Bowl vs. National Atomic Co | Hollywood Bowl vs. OTP Bank Nyrt | Hollywood Bowl vs. Samsung Electronics Co | Hollywood Bowl vs. Samsung Electronics Co |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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