Correlation Between Phoenix Materials and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both Phoenix Materials 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 Phoenix Materials and Aprogen Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phoenix Materials Co and Aprogen Healthcare Games, you can compare the effects of market volatilities on Phoenix Materials 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 Phoenix Materials with a short position of Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix Materials and Aprogen Healthcare.
Diversification Opportunities for Phoenix Materials and Aprogen Healthcare
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Phoenix and Aprogen is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Phoenix Materials 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 Phoenix Materials 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 Phoenix Materials 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 Phoenix Materials i.e., Phoenix Materials and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between Phoenix Materials and Aprogen Healthcare
Assuming the 90 days trading horizon Phoenix Materials Co is expected to generate 1.16 times more return on investment than Aprogen Healthcare. However, Phoenix Materials is 1.16 times more volatile than Aprogen Healthcare Games. It trades about -0.03 of its potential returns per unit of risk. Aprogen Healthcare Games is currently generating about -0.05 per unit of risk. If you would invest 107,800 in Phoenix Materials Co on September 4, 2024 and sell it today you would lose (41,900) from holding Phoenix Materials Co or give up 38.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Phoenix Materials Co vs. Aprogen Healthcare Games
Performance |
| Timeline |
| Phoenix Materials |
| Aprogen Healthcare Games |
Phoenix Materials and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Phoenix Materials and Aprogen Healthcare
The main advantage of trading using opposite Phoenix Materials and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix Materials 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.| Phoenix Materials vs. Dongsin Engineering Construction | Phoenix Materials vs. Doosan Fuel Cell | Phoenix Materials vs. Daishin Balance 1 | Phoenix Materials vs. Total Soft Bank |
| Aprogen Healthcare vs. Dongsin Engineering Construction | Aprogen Healthcare vs. Doosan Fuel Cell | Aprogen Healthcare vs. Daishin Balance 1 | Aprogen Healthcare vs. Total Soft Bank |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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