Correlation Between Lotte Non and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both Lotte Non and Aprogen Healthcare 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 Lotte Non and Aprogen Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Non Life Insurance and Aprogen Healthcare Games, you can compare the effects of market volatilities on Lotte Non and Aprogen Healthcare 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 Lotte Non with a short position of Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Non and Aprogen Healthcare.
Diversification Opportunities for Lotte Non and Aprogen Healthcare
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Lotte and Aprogen is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Non Life Insurance and Aprogen Healthcare Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aprogen Healthcare Games and Lotte Non 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 Lotte Non Life Insurance are associated (or correlated) with Aprogen Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aprogen Healthcare Games has no effect on the direction of Lotte Non i.e., Lotte Non and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between Lotte Non and Aprogen Healthcare
Assuming the 90 days trading horizon Lotte Non Life Insurance is expected to generate 0.58 times more return on investment than Aprogen Healthcare. However, Lotte Non Life Insurance is 1.71 times less risky than Aprogen Healthcare. It trades about -0.18 of its potential returns per unit of risk. Aprogen Healthcare Games is currently generating about -0.12 per unit of risk. If you would invest 227,000 in Lotte Non Life Insurance on September 1, 2024 and sell it today you would lose (23,500) from holding Lotte Non Life Insurance or give up 10.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Non Life Insurance vs. Aprogen Healthcare Games
Performance |
| Timeline |
| Lotte Non Life |
| Aprogen Healthcare Games |
Lotte Non and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Non and Aprogen Healthcare
The main advantage of trading using opposite Lotte Non and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Non position performs unexpectedly, Aprogen Healthcare 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 Aprogen Healthcare will offset losses from the drop in Aprogen Healthcare's long position.| Lotte Non vs. AptaBio Therapeutics | Lotte Non vs. Daewoo SBI SPAC | Lotte Non vs. Dream Security co | Lotte Non vs. Microfriend |
| Aprogen Healthcare vs. Dongsin Engineering Construction | Aprogen Healthcare vs. Doosan Fuel Cell | Aprogen Healthcare vs. Daishin Balance 1 | Aprogen Healthcare vs. Total Soft Bank |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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