Correlation Between Ethereum and Hyundai Hcn

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

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

Diversification Opportunities for Ethereum and Hyundai Hcn

0.14

Correlation Coefficient

Ethereum  Hyundai Hcn

Average diversification

The 3 months correlation between Ethereum and Hyundai is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum and Hyundai Hcn in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Hcn and Ethereum 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 Ethereum are associated (or correlated) with Hyundai Hcn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Hcn has no effect on the direction of Ethereum i.e., Ethereum and Hyundai Hcn go up and down completely randomly.

Pair Corralation between Ethereum and Hyundai Hcn

Assuming the 90 days trading horizon Ethereum is expected to generate 12.23 times less return on investment than Hyundai Hcn. In addition to that, Ethereum is 1.55 times more volatile than Hyundai Hcn. It trades about 0.0 of its total potential returns per unit of risk. Hyundai Hcn is currently generating about 0.03 per unit of volatility. If you would invest  316,500  in Hyundai Hcn on October 24, 2024 and sell it today you would earn a total of  34,500  from holding Hyundai Hcn or generate 10.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	72.92%
Values	Daily Returns

Ethereum  vs.  Hyundai Hcn

Ethereum

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ethereum are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical indicators, Ethereum exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hyundai Hcn

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hyundai Hcn has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Ethereum and Hyundai Hcn

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

The idea behind Ethereum and Hyundai Hcn 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.