Correlation Between Oscotec and AptaBio Therapeutics
Can any of the company-specific risk be diversified away by investing in both Oscotec 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 Oscotec and AptaBio Therapeutics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oscotec and AptaBio Therapeutics, you can compare the effects of market volatilities on Oscotec 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 Oscotec with a short position of AptaBio Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oscotec and AptaBio Therapeutics.
Diversification Opportunities for Oscotec and AptaBio Therapeutics
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Oscotec and AptaBio is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Oscotec and AptaBio Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AptaBio Therapeutics and Oscotec 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 Oscotec 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 Oscotec i.e., Oscotec and AptaBio Therapeutics go up and down completely randomly.
Pair Corralation between Oscotec and AptaBio Therapeutics
Assuming the 90 days trading horizon Oscotec is expected to generate 0.95 times more return on investment than AptaBio Therapeutics. However, Oscotec is 1.05 times less risky than AptaBio Therapeutics. It trades about 0.03 of its potential returns per unit of risk. AptaBio Therapeutics is currently generating about -0.01 per unit of risk. If you would invest 1,955,000 in Oscotec on August 28, 2024 and sell it today you would earn a total of 525,000 from holding Oscotec or generate 26.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oscotec vs. AptaBio Therapeutics
Performance |
| Timeline |
| Oscotec |
| AptaBio Therapeutics |
Oscotec and AptaBio Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oscotec and AptaBio Therapeutics
The main advantage of trading using opposite Oscotec and AptaBio Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oscotec 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.| Oscotec vs. Medy Tox | Oscotec vs. Busan Industrial Co | Oscotec vs. Busan Ind | Oscotec vs. Mirae Asset Daewoo |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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