Correlation Between Sunny Electronics and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both Sunny Electronics 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 Sunny Electronics and AptaBio Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sunny Electronics Corp and AptaBio Therapeutics, you can compare the effects of market volatilities on Sunny Electronics 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 Sunny Electronics with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunny Electronics and AptaBio Therapeutics.
Diversification Opportunities for Sunny Electronics and AptaBio Therapeutics
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sunny and AptaBio is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Sunny Electronics Corp and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and Sunny Electronics 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 Sunny Electronics Corp 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 Sunny Electronics i.e., Sunny Electronics and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between Sunny Electronics and AptaBio Therapeutics
Assuming the 90 days trading horizon Sunny Electronics Corp is expected to generate 0.64 times more return on investment than AptaBio Therapeutics. However, Sunny Electronics Corp is 1.56 times less risky than AptaBio Therapeutics. It trades about 0.07 of its potential returns per unit of risk. AptaBio Therapeutics is currently generating about -0.28 per unit of risk. If you would invest 159,500 in Sunny Electronics Corp on August 29, 2024 and sell it today you would earn a total of 3,900 from holding Sunny Electronics Corp or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sunny Electronics Corp vs. AptaBio Therapeutics
Performance |
| Timeline |
| Sunny Electronics Corp |
| AptaBio Therapeutics |
Sunny Electronics and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sunny Electronics and AptaBio Therapeutics
The main advantage of trading using opposite Sunny Electronics and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunny Electronics 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.| Sunny Electronics vs. AptaBio Therapeutics | Sunny Electronics vs. Daewoo SBI SPAC | Sunny Electronics vs. Dream Security co | Sunny Electronics vs. Microfriend |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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