Correlation Between CJ Seafood and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both CJ Seafood 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 CJ Seafood and AptaBio Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CJ Seafood Corp and AptaBio Therapeutics, you can compare the effects of market volatilities on CJ Seafood 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 CJ Seafood with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of CJ Seafood and AptaBio Therapeutics.
Diversification Opportunities for CJ Seafood and AptaBio Therapeutics
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 011150 and AptaBio is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding CJ Seafood Corp and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and CJ Seafood 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 CJ Seafood 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 CJ Seafood i.e., CJ Seafood and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between CJ Seafood and AptaBio Therapeutics
Assuming the 90 days trading horizon CJ Seafood Corp is expected to generate 0.53 times more return on investment than AptaBio Therapeutics. However, CJ Seafood Corp is 1.9 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 -0.13 per unit of risk. If you would invest 333,000 in CJ Seafood Corp on August 29, 2024 and sell it today you would lose (32,500) from holding CJ Seafood Corp or give up 9.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CJ Seafood Corp vs. AptaBio Therapeutics
Performance |
| Timeline |
| CJ Seafood Corp |
| AptaBio Therapeutics |
CJ Seafood and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CJ Seafood and AptaBio Therapeutics
The main advantage of trading using opposite CJ Seafood and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CJ Seafood 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.| CJ Seafood vs. AptaBio Therapeutics | CJ Seafood vs. Daewoo SBI SPAC | CJ Seafood vs. Dream Security co | CJ Seafood vs. Microfriend |
| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec | AptaBio Therapeutics vs. Busan Industrial Co |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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