Correlation Between Seoam Machinery and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both Seoam Machinery 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 Seoam Machinery and Aprogen Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seoam Machinery Industry and Aprogen Healthcare Games, you can compare the effects of market volatilities on Seoam Machinery 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 Seoam Machinery with a short position of Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seoam Machinery and Aprogen Healthcare.
Diversification Opportunities for Seoam Machinery and Aprogen Healthcare
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Seoam and Aprogen is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Seoam Machinery Industry 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 Seoam Machinery 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 Seoam Machinery Industry 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 Seoam Machinery i.e., Seoam Machinery and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between Seoam Machinery and Aprogen Healthcare
Assuming the 90 days trading horizon Seoam Machinery is expected to generate 1.32 times less return on investment than Aprogen Healthcare. But when comparing it to its historical volatility, Seoam Machinery Industry is 3.28 times less risky than Aprogen Healthcare. It trades about 0.32 of its potential returns per unit of risk. Aprogen Healthcare Games is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 45,600 in Aprogen Healthcare Games on October 11, 2024 and sell it today you would earn a total of 5,700 from holding Aprogen Healthcare Games or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Seoam Machinery Industry vs. Aprogen Healthcare Games
Performance |
| Timeline |
| Seoam Machinery Industry |
| Aprogen Healthcare Games |
Seoam Machinery and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Seoam Machinery and Aprogen Healthcare
The main advantage of trading using opposite Seoam Machinery and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seoam Machinery 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.| Seoam Machinery vs. Kukdong Oil Chemicals | Seoam Machinery vs. Kukdo Chemical Co | Seoam Machinery vs. Shinhan Inverse Silver | Seoam Machinery vs. Daejung Chemicals Metals |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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