Correlation Between AptaBio Therapeutics and Hankook Furniture
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Hankook Furniture 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 AptaBio Therapeutics and Hankook Furniture into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Hankook Furniture Co, you can compare the effects of market volatilities on AptaBio Therapeutics and Hankook Furniture 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 AptaBio Therapeutics with a short position of Hankook Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Hankook Furniture.
Diversification Opportunities for AptaBio Therapeutics and Hankook Furniture
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AptaBio and Hankook is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Hankook Furniture Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hankook Furniture and AptaBio Therapeutics 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 AptaBio Therapeutics are associated (or correlated) with Hankook Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hankook Furniture has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Hankook Furniture go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Hankook Furniture
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 3.5 times more return on investment than Hankook Furniture. However, AptaBio Therapeutics is 3.5 times more volatile than Hankook Furniture Co. It trades about 0.12 of its potential returns per unit of risk. Hankook Furniture Co is currently generating about 0.03 per unit of risk. If you would invest 651,000 in AptaBio Therapeutics on October 14, 2024 and sell it today you would earn a total of 46,000 from holding AptaBio Therapeutics or generate 7.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. Hankook Furniture Co
Performance |
| Timeline |
| AptaBio Therapeutics |
| Hankook Furniture |
AptaBio Therapeutics and Hankook Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and Hankook Furniture
The main advantage of trading using opposite AptaBio Therapeutics and Hankook Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Hankook Furniture 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 Hankook Furniture will offset losses from the drop in Hankook Furniture's long position.| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
| Hankook Furniture vs. AptaBio Therapeutics | Hankook Furniture vs. Cytogen | Hankook Furniture vs. Woori Technology Investment | Hankook Furniture vs. ABL Bio |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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