Correlation Between APro and RS Automation
Can any of the company-specific risk be diversified away by investing in both APro and RS Automation 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 APro and RS Automation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between APro Co and RS Automation CoLtd, you can compare the effects of market volatilities on APro and RS Automation 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 APro with a short position of RS Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of APro and RS Automation.
Diversification Opportunities for APro and RS Automation
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between APro and 140670 is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding APro Co and RS Automation CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RS Automation CoLtd and APro 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 APro Co are associated (or correlated) with RS Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RS Automation CoLtd has no effect on the direction of APro i.e., APro and RS Automation go up and down completely randomly.
Pair Corralation between APro and RS Automation
Assuming the 90 days trading horizon APro Co is expected to under-perform the RS Automation. But the stock apears to be less risky and, when comparing its historical volatility, APro Co is 1.59 times less risky than RS Automation. The stock trades about -0.05 of its potential returns per unit of risk. The RS Automation CoLtd is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,384,000 in RS Automation CoLtd on November 27, 2024 and sell it today you would earn a total of 371,000 from holding RS Automation CoLtd or generate 26.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
APro Co vs. RS Automation CoLtd
Performance |
| Timeline |
| APro |
| RS Automation CoLtd |
APro and RS Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with APro and RS Automation
The main advantage of trading using opposite APro and RS Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APro position performs unexpectedly, RS Automation 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 RS Automation will offset losses from the drop in RS Automation's long position.| APro vs. Ecopro BM Co | APro vs. Sangsin Energy Display | APro vs. Bosung Power Technology | APro vs. NOVATECH Co |
| RS Automation vs. Sangsangin Investment Securities | RS Automation vs. NH Investment Securities | RS Automation vs. LB Investment | RS Automation 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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