Correlation Between SK Hynix and Moadata

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

By analyzing existing cross correlation between SK Hynix and Moadata Co, you can compare the effects of market volatilities on SK Hynix and Moadata 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 SK Hynix with a short position of Moadata. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Hynix and Moadata.

Diversification Opportunities for SK Hynix and Moadata

0.13

Correlation Coefficient

SK Hynix  Moadata

Average diversification

The 3 months correlation between 000660 and Moadata is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding SK Hynix and Moadata Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moadata and SK Hynix 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 SK Hynix are associated (or correlated) with Moadata. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moadata has no effect on the direction of SK Hynix i.e., SK Hynix and Moadata go up and down completely randomly.

Pair Corralation between SK Hynix and Moadata

Assuming the 90 days trading horizon SK Hynix is expected to generate 1.11 times more return on investment than Moadata. However, SK Hynix is 1.11 times more volatile than Moadata Co. It trades about 0.14 of its potential returns per unit of risk. Moadata Co is currently generating about -0.1 per unit of risk. If you would invest  16,900,700  in SK Hynix on December 25, 2024 and sell it today you would earn a total of  4,249,300  from holding SK Hynix or generate 25.14% return on investment over 90 days.

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

SK Hynix  vs.  Moadata Co

SK Hynix

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SK Hynix are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, SK Hynix sustained solid returns over the last few months and may actually be approaching a breakup point.

Moadata

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moadata Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with SK Hynix and Moadata

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

The idea behind SK Hynix and Moadata Co 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.