Correlation Between AptaBio Therapeutics and LG Display
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and LG Display 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 LG Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and LG Display Co, you can compare the effects of market volatilities on AptaBio Therapeutics and LG Display 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 LG Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and LG Display.
Diversification Opportunities for AptaBio Therapeutics and LG Display
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AptaBio and 034220 is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and LG Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Display 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 LG Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Display has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and LG Display go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and LG Display
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 2.9 times more return on investment than LG Display. However, AptaBio Therapeutics is 2.9 times more volatile than LG Display Co. It trades about 0.21 of its potential returns per unit of risk. LG Display Co is currently generating about 0.0 per unit of risk. If you would invest 627,000 in AptaBio Therapeutics on November 2, 2024 and sell it today you would earn a total of 79,000 from holding AptaBio Therapeutics or generate 12.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AptaBio Therapeutics vs. LG Display Co
Performance |
| Timeline |
| AptaBio Therapeutics |
| LG Display |
AptaBio Therapeutics and LG Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AptaBio Therapeutics and LG Display
The main advantage of trading using opposite AptaBio Therapeutics and LG Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, LG Display 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 LG Display will offset losses from the drop in LG Display's long position.| AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
| LG Display vs. Sung Bo Chemicals | LG Display vs. Korean Reinsurance Co | LG Display vs. Kukdong Oil Chemicals | LG Display vs. Youngchang Chemical Co |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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