Correlation Between Lotte Chilsung and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both Lotte Chilsung 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 Lotte Chilsung and AptaBio Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lotte Chilsung Beverage and AptaBio Therapeutics, you can compare the effects of market volatilities on Lotte Chilsung 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 Lotte Chilsung with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotte Chilsung and AptaBio Therapeutics.
Diversification Opportunities for Lotte Chilsung and AptaBio Therapeutics
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Lotte and AptaBio is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Lotte Chilsung Beverage and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and Lotte Chilsung 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 Chilsung Beverage 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 Lotte Chilsung i.e., Lotte Chilsung and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between Lotte Chilsung and AptaBio Therapeutics
Assuming the 90 days trading horizon Lotte Chilsung Beverage is expected to generate 0.39 times more return on investment than AptaBio Therapeutics. However, Lotte Chilsung Beverage is 2.55 times less risky than AptaBio Therapeutics. It trades about -0.02 of its potential returns per unit of risk. AptaBio Therapeutics is currently generating about -0.02 per unit of risk. If you would invest 15,321,000 in Lotte Chilsung Beverage on August 24, 2024 and sell it today you would lose (3,321,000) from holding Lotte Chilsung Beverage or give up 21.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotte Chilsung Beverage vs. AptaBio Therapeutics
Performance |
| Timeline |
| Lotte Chilsung Beverage |
| AptaBio Therapeutics |
Lotte Chilsung and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotte Chilsung and AptaBio Therapeutics
The main advantage of trading using opposite Lotte Chilsung and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotte Chilsung 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.| Lotte Chilsung vs. AptaBio Therapeutics | Lotte Chilsung vs. Daewoo SBI SPAC | Lotte Chilsung vs. Dream Security co | Lotte Chilsung vs. Microfriend |
| 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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