Correlation Between Dongbu Insurance and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both Dongbu Insurance 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 Dongbu Insurance and Aprogen Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dongbu Insurance Co and Aprogen Healthcare Games, you can compare the effects of market volatilities on Dongbu Insurance 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 Dongbu Insurance with a short position of Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongbu Insurance and Aprogen Healthcare.
Diversification Opportunities for Dongbu Insurance and Aprogen Healthcare
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dongbu and Aprogen is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Dongbu Insurance Co 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 Dongbu Insurance 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 Dongbu Insurance Co 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 Dongbu Insurance i.e., Dongbu Insurance and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between Dongbu Insurance and Aprogen Healthcare
Assuming the 90 days trading horizon Dongbu Insurance Co is expected to under-perform the Aprogen Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, Dongbu Insurance Co is 1.52 times less risky than Aprogen Healthcare. The stock trades about -0.25 of its potential returns per unit of risk. The Aprogen Healthcare Games is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest 58,400 in Aprogen Healthcare Games on October 24, 2024 and sell it today you would lose (6,200) from holding Aprogen Healthcare Games or give up 10.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongbu Insurance Co vs. Aprogen Healthcare Games
Performance |
| Timeline |
| Dongbu Insurance |
| Aprogen Healthcare Games |
Dongbu Insurance and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongbu Insurance and Aprogen Healthcare
The main advantage of trading using opposite Dongbu Insurance and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongbu Insurance 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.| Dongbu Insurance vs. Hanjoo Light Metal | Dongbu Insurance vs. Heungkuk Metaltech CoLtd | Dongbu Insurance vs. Duksan Hi Metal | Dongbu Insurance vs. MetaLabs Co |
| Aprogen Healthcare vs. Hyundai Green Food | Aprogen Healthcare vs. Seoul Food Industrial | Aprogen Healthcare vs. Dongbu Insurance Co | Aprogen Healthcare vs. Sajo Seafood |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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