Correlation Between Aprogen Healthcare and Cheryong Industrial
Can any of the company-specific risk be diversified away by investing in both Aprogen Healthcare and Cheryong Industrial 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 Cheryong Industrial 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 Cheryong Industrial CoLtd, you can compare the effects of market volatilities on Aprogen Healthcare and Cheryong Industrial 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 Cheryong Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aprogen Healthcare and Cheryong Industrial.
Diversification Opportunities for Aprogen Healthcare and Cheryong Industrial
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aprogen and Cheryong is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Aprogen Healthcare Games and Cheryong Industrial CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheryong Industrial CoLtd 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 Cheryong Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheryong Industrial CoLtd has no effect on the direction of Aprogen Healthcare i.e., Aprogen Healthcare and Cheryong Industrial go up and down completely randomly.
Pair Corralation between Aprogen Healthcare and Cheryong Industrial
Assuming the 90 days trading horizon Aprogen Healthcare Games is expected to under-perform the Cheryong Industrial. In addition to that, Aprogen Healthcare is 1.26 times more volatile than Cheryong Industrial CoLtd. It trades about -0.09 of its total potential returns per unit of risk. Cheryong Industrial CoLtd is currently generating about -0.1 per unit of volatility. If you would invest 617,000 in Cheryong Industrial CoLtd on August 30, 2024 and sell it today you would lose (52,000) from holding Cheryong Industrial CoLtd or give up 8.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Aprogen Healthcare Games vs. Cheryong Industrial CoLtd
Performance |
| Timeline |
| Aprogen Healthcare Games |
| Cheryong Industrial CoLtd |
Aprogen Healthcare and Cheryong Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aprogen Healthcare and Cheryong Industrial
The main advantage of trading using opposite Aprogen Healthcare and Cheryong Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aprogen Healthcare position performs unexpectedly, Cheryong Industrial 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 Cheryong Industrial will offset losses from the drop in Cheryong Industrial's long position.| Aprogen Healthcare vs. Daou Data Corp | Aprogen Healthcare vs. Busan Industrial Co | Aprogen Healthcare vs. Busan Ind | Aprogen Healthcare vs. Shinhan WTI Futures |
| Cheryong Industrial vs. Lion Chemtech Co | Cheryong Industrial vs. Kuk Young GM | Cheryong Industrial vs. Nature and Environment | Cheryong Industrial vs. IL Science 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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