Correlation Between AptaBio Therapeutics and Korea Refractories
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Korea Refractories 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 Korea Refractories into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Korea Refractories Co, you can compare the effects of market volatilities on AptaBio Therapeutics and Korea Refractories 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 Korea Refractories. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Korea Refractories.
Diversification Opportunities for AptaBio Therapeutics and Korea Refractories
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AptaBio and Korea is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Korea Refractories Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea Refractories 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 Korea Refractories. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea Refractories has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Korea Refractories go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Korea Refractories
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 3.18 times more return on investment than Korea Refractories. However, AptaBio Therapeutics is 3.18 times more volatile than Korea Refractories Co. It trades about 0.01 of its potential returns per unit of risk. Korea Refractories Co is currently generating about -0.08 per unit of risk. If you would invest 827,000 in AptaBio Therapeutics on September 15, 2024 and sell it today you would lose (176,000) from holding AptaBio Therapeutics or give up 21.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. Korea Refractories Co
Performance |
| Timeline |
| AptaBio Therapeutics |
| Korea Refractories |
AptaBio Therapeutics and Korea Refractories Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and Korea Refractories
The main advantage of trading using opposite AptaBio Therapeutics and Korea Refractories positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Korea Refractories 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 Korea Refractories will offset losses from the drop in Korea Refractories' long position.| AptaBio Therapeutics vs. KNOTUS CoLtd | AptaBio Therapeutics vs. Bridge Biotherapeutics | AptaBio Therapeutics vs. Cytogen | AptaBio Therapeutics vs. Genolution |
| Korea Refractories vs. Samsung Electronics Co | Korea Refractories vs. Samsung Electronics Co | Korea Refractories vs. SK Hynix | Korea Refractories vs. POSCO Holdings |
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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