Correlation Between Aprogen Healthcare and Wave Electronics
Can any of the company-specific risk be diversified away by investing in both Aprogen Healthcare and Wave Electronics 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 Aprogen Healthcare and Wave Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aprogen Healthcare Games and Wave Electronics Co, you can compare the effects of market volatilities on Aprogen Healthcare and Wave Electronics 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 Aprogen Healthcare with a short position of Wave Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aprogen Healthcare and Wave Electronics.
Diversification Opportunities for Aprogen Healthcare and Wave Electronics
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aprogen and Wave is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Aprogen Healthcare Games and Wave Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wave Electronics and Aprogen Healthcare 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 Aprogen Healthcare Games are associated (or correlated) with Wave Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wave Electronics has no effect on the direction of Aprogen Healthcare i.e., Aprogen Healthcare and Wave Electronics go up and down completely randomly.
Pair Corralation between Aprogen Healthcare and Wave Electronics
Assuming the 90 days trading horizon Aprogen Healthcare Games is expected to generate 1.01 times more return on investment than Wave Electronics. However, Aprogen Healthcare is 1.01 times more volatile than Wave Electronics Co. It trades about 0.14 of its potential returns per unit of risk. Wave Electronics Co is currently generating about 0.07 per unit of risk. If you would invest 46,200 in Aprogen Healthcare Games on December 4, 2024 and sell it today you would earn a total of 4,200 from holding Aprogen Healthcare Games or generate 9.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aprogen Healthcare Games vs. Wave Electronics Co
Performance |
| Timeline |
| Aprogen Healthcare Games |
| Wave Electronics |
Aprogen Healthcare and Wave Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aprogen Healthcare and Wave Electronics
The main advantage of trading using opposite Aprogen Healthcare and Wave Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aprogen Healthcare position performs unexpectedly, Wave Electronics 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 Wave Electronics will offset losses from the drop in Wave Electronics' long position.| Aprogen Healthcare vs. Heungkuk Metaltech CoLtd | Aprogen Healthcare vs. SBI Investment KOREA | Aprogen Healthcare vs. Shinhan Inverse Copper | Aprogen Healthcare vs. Golden Bridge Investment |
| Wave Electronics vs. Daechang Steel Co | Wave Electronics vs. Husteel | Wave Electronics vs. Dong A Steel Technology | Wave Electronics vs. DB Financial Investment |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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