Correlation Between AptaBio Therapeutics and Hanshin Construction
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Hanshin Construction 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 Hanshin Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Hanshin Construction Co, you can compare the effects of market volatilities on AptaBio Therapeutics and Hanshin Construction 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 Hanshin Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Hanshin Construction.
Diversification Opportunities for AptaBio Therapeutics and Hanshin Construction
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between AptaBio and Hanshin is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Hanshin Construction Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanshin Construction 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 Hanshin Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanshin Construction has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Hanshin Construction go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Hanshin Construction
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 2.75 times more return on investment than Hanshin Construction. However, AptaBio Therapeutics is 2.75 times more volatile than Hanshin Construction Co. It trades about 0.01 of its potential returns per unit of risk. Hanshin Construction Co is currently generating about 0.01 per unit of risk. If you would invest 786,000 in AptaBio Therapeutics on August 29, 2024 and sell it today you would lose (129,000) from holding AptaBio Therapeutics or give up 16.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. Hanshin Construction Co
Performance |
| Timeline |
| AptaBio Therapeutics |
| Hanshin Construction |
AptaBio Therapeutics and Hanshin Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and Hanshin Construction
The main advantage of trading using opposite AptaBio Therapeutics and Hanshin Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Hanshin Construction 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 Hanshin Construction will offset losses from the drop in Hanshin Construction's long position.| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec | AptaBio Therapeutics vs. Busan Industrial Co |
| Hanshin Construction vs. AptaBio Therapeutics | Hanshin Construction vs. Daewoo SBI SPAC | Hanshin Construction vs. Dream Security co | Hanshin Construction vs. Microfriend |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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