Correlation Between Hyundai and Schloss Wachenheim

Can any of the company-specific risk be diversified away by investing in both Hyundai and Schloss Wachenheim 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 Schloss Wachenheim into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hyundai Motor and Schloss Wachenheim AG, you can compare the effects of market volatilities on Hyundai and Schloss Wachenheim 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 Schloss Wachenheim. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyundai and Schloss Wachenheim.

Diversification Opportunities for Hyundai and Schloss Wachenheim

0.68

Correlation Coefficient

Hyundai  Schloss Wachenheim

Poor diversification

The 3 months correlation between Hyundai and Schloss is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Hyundai Motor and Schloss Wachenheim AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schloss Wachenheim 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 Schloss Wachenheim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schloss Wachenheim has no effect on the direction of Hyundai i.e., Hyundai and Schloss Wachenheim go up and down completely randomly.

Pair Corralation between Hyundai and Schloss Wachenheim

Assuming the 90 days trading horizon Hyundai Motor is expected to under-perform the Schloss Wachenheim. But the stock apears to be less risky and, when comparing its historical volatility, Hyundai Motor is 1.17 times less risky than Schloss Wachenheim. The stock trades about -0.11 of its potential returns per unit of risk. The Schloss Wachenheim AG is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  1,477  in Schloss Wachenheim AG on September 13, 2024 and sell it today you would lose (27.00) from holding Schloss Wachenheim AG or give up 1.83% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Hyundai Motor  vs.  Schloss Wachenheim AG

Hyundai Motor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hyundai Motor has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Schloss Wachenheim

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Schloss Wachenheim AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Schloss Wachenheim is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Hyundai and Schloss Wachenheim

The main advantage of trading using opposite Hyundai and Schloss Wachenheim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyundai position performs unexpectedly, Schloss Wachenheim 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 Schloss Wachenheim will offset losses from the drop in Schloss Wachenheim's long position.

The idea behind Hyundai Motor and Schloss Wachenheim AG pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.