Correlation Between Aprogen Healthcare and LS Materials
Can any of the company-specific risk be diversified away by investing in both Aprogen Healthcare and LS Materials 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 LS Materials 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 LS Materials, you can compare the effects of market volatilities on Aprogen Healthcare and LS Materials 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 LS Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aprogen Healthcare and LS Materials.
Diversification Opportunities for Aprogen Healthcare and LS Materials
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aprogen and 417200 is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Aprogen Healthcare Games and LS Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LS Materials 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 LS Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LS Materials has no effect on the direction of Aprogen Healthcare i.e., Aprogen Healthcare and LS Materials go up and down completely randomly.
Pair Corralation between Aprogen Healthcare and LS Materials
Assuming the 90 days trading horizon Aprogen Healthcare Games is expected to generate 1.5 times more return on investment than LS Materials. However, Aprogen Healthcare is 1.5 times more volatile than LS Materials. It trades about -0.12 of its potential returns per unit of risk. LS Materials is currently generating about -0.44 per unit of risk. If you would invest 52,700 in Aprogen Healthcare Games on September 1, 2024 and sell it today you would lose (6,900) from holding Aprogen Healthcare Games or give up 13.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aprogen Healthcare Games vs. LS Materials
Performance |
| Timeline |
| Aprogen Healthcare Games |
| LS Materials |
Aprogen Healthcare and LS Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aprogen Healthcare and LS Materials
The main advantage of trading using opposite Aprogen Healthcare and LS Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aprogen Healthcare position performs unexpectedly, LS Materials 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 LS Materials will offset losses from the drop in LS Materials' long position.| Aprogen Healthcare vs. Dongsin Engineering Construction | Aprogen Healthcare vs. Doosan Fuel Cell | Aprogen Healthcare vs. Daishin Balance 1 | Aprogen Healthcare vs. Total Soft Bank |
| LS Materials vs. HJ ShipBuilding Construction | LS Materials vs. Sungchang Autotech Co | LS Materials vs. Camus Engineering Construction | LS Materials vs. Seohee Construction 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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