Correlation Between SungMoon Electronics and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both SungMoon 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 SungMoon 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 SungMoon Electronics Co and AptaBio Therapeutics, you can compare the effects of market volatilities on SungMoon 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 SungMoon Electronics with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of SungMoon Electronics and AptaBio Therapeutics.
Diversification Opportunities for SungMoon Electronics and AptaBio Therapeutics
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SungMoon and AptaBio is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding SungMoon Electronics Co and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and SungMoon 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 SungMoon Electronics Co 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 SungMoon Electronics i.e., SungMoon Electronics and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between SungMoon Electronics and AptaBio Therapeutics
Assuming the 90 days trading horizon SungMoon Electronics Co is expected to generate 0.33 times more return on investment than AptaBio Therapeutics. However, SungMoon Electronics Co is 3.02 times less risky than AptaBio Therapeutics. It trades about -0.12 of its potential returns per unit of risk. AptaBio Therapeutics is currently generating about -0.13 per unit of risk. If you would invest 122,200 in SungMoon Electronics Co on August 29, 2024 and sell it today you would lose (11,100) from holding SungMoon Electronics Co or give up 9.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SungMoon Electronics Co vs. AptaBio Therapeutics
Performance |
| Timeline |
| SungMoon Electronics |
| AptaBio Therapeutics |
SungMoon Electronics and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SungMoon Electronics and AptaBio Therapeutics
The main advantage of trading using opposite SungMoon Electronics and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SungMoon 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.| SungMoon Electronics vs. AptaBio Therapeutics | SungMoon Electronics vs. Daewoo SBI SPAC | SungMoon Electronics vs. Dream Security co | SungMoon Electronics 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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