Correlation Between AptaBio Therapeutics and Kumho Petro
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Kumho Petro 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 Kumho Petro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Kumho Petro Chemical, you can compare the effects of market volatilities on AptaBio Therapeutics and Kumho Petro 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 Kumho Petro. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Kumho Petro.
Diversification Opportunities for AptaBio Therapeutics and Kumho Petro
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AptaBio and Kumho is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Kumho Petro Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kumho Petro Chemical 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 Kumho Petro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kumho Petro Chemical has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Kumho Petro go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Kumho Petro
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 1.34 times less return on investment than Kumho Petro. In addition to that, AptaBio Therapeutics is 1.03 times more volatile than Kumho Petro Chemical. It trades about 0.18 of its total potential returns per unit of risk. Kumho Petro Chemical is currently generating about 0.24 per unit of volatility. If you would invest 9,060,000 in Kumho Petro Chemical on October 30, 2024 and sell it today you would earn a total of 1,380,000 from holding Kumho Petro Chemical or generate 15.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. Kumho Petro Chemical
Performance |
| Timeline |
| AptaBio Therapeutics |
| Kumho Petro Chemical |
AptaBio Therapeutics and Kumho Petro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and Kumho Petro
The main advantage of trading using opposite AptaBio Therapeutics and Kumho Petro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Kumho Petro 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 Kumho Petro will offset losses from the drop in Kumho Petro's long position.| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
| Kumho Petro vs. KB Financial Group | Kumho Petro vs. Shinhan Financial Group | Kumho Petro vs. Hana Financial | Kumho Petro vs. Woori Financial Group |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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