Correlation Between Bukwang Pharm and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both Bukwang Pharm and AptaBio Therapeutics 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 Bukwang Pharm and AptaBio Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bukwang Pharm and AptaBio Therapeutics, you can compare the effects of market volatilities on Bukwang Pharm and AptaBio Therapeutics 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 Bukwang Pharm with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bukwang Pharm and AptaBio Therapeutics.
Diversification Opportunities for Bukwang Pharm and AptaBio Therapeutics
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bukwang and AptaBio is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Bukwang Pharm and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and Bukwang Pharm 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 Bukwang Pharm are associated (or correlated) with AptaBio Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AptaBio Therapeutics has no effect on the direction of Bukwang Pharm i.e., Bukwang Pharm and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between Bukwang Pharm and AptaBio Therapeutics
Assuming the 90 days trading horizon Bukwang Pharm is expected to under-perform the AptaBio Therapeutics. But the stock apears to be less risky and, when comparing its historical volatility, Bukwang Pharm is 2.78 times less risky than AptaBio Therapeutics. The stock trades about -0.06 of its potential returns per unit of risk. The AptaBio Therapeutics is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 566,000 in AptaBio Therapeutics on September 2, 2024 and sell it today you would earn a total of 86,000 from holding AptaBio Therapeutics or generate 15.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bukwang Pharm vs. AptaBio Therapeutics
Performance |
| Timeline |
| Bukwang Pharm |
| AptaBio Therapeutics |
Bukwang Pharm and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bukwang Pharm and AptaBio Therapeutics
The main advantage of trading using opposite Bukwang Pharm and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bukwang Pharm position performs unexpectedly, AptaBio Therapeutics 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 AptaBio Therapeutics will offset losses from the drop in AptaBio Therapeutics' long position.| Bukwang Pharm vs. Samyung Trading Co | Bukwang Pharm vs. Daiyang Metal Co | Bukwang Pharm vs. E Investment Development | Bukwang Pharm vs. DONGKUK TED METAL |
| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
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 Stocks Directory module to find actively traded stocks across global markets.
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