Correlation Between SK Hynix and Kuehne +

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

By analyzing existing cross correlation between SK hynix and Kuehne Nagel International, you can compare the effects of market volatilities on SK Hynix and Kuehne + 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 Kuehne +. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Hynix and Kuehne +.

Diversification Opportunities for SK Hynix and Kuehne +

0.12

Correlation Coefficient

SK Hynix  Kuehne +

Average diversification

The 3 months correlation between HY9H and Kuehne is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding SK hynix and Kuehne Nagel International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuehne Nagel Interna 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 Kuehne +. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuehne Nagel Interna has no effect on the direction of SK Hynix i.e., SK Hynix and Kuehne + go up and down completely randomly.

Pair Corralation between SK Hynix and Kuehne +

Assuming the 90 days trading horizon SK hynix is expected to generate 2.04 times more return on investment than Kuehne +. However, SK Hynix is 2.04 times more volatile than Kuehne Nagel International. It trades about 0.06 of its potential returns per unit of risk. Kuehne Nagel International is currently generating about 0.01 per unit of risk. If you would invest  11,100  in SK hynix on December 29, 2024 and sell it today you would earn a total of  1,300  from holding SK hynix or generate 11.71% 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.  Kuehne Nagel International

SK hynix

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in SK hynix are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, SK Hynix reported solid returns over the last few months and may actually be approaching a breakup point.

Kuehne Nagel Interna

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kuehne Nagel International are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable forward indicators, Kuehne + is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with SK Hynix and Kuehne +

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

The idea behind SK hynix and Kuehne Nagel International 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 Stocks Directory module to find actively traded stocks across global markets.