Correlation Between LG Energy and Aprogen Healthcare
Can any of the company-specific risk be diversified away by investing in both LG Energy and Aprogen Healthcare 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 LG Energy and Aprogen Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LG Energy Solution and Aprogen Healthcare Games, you can compare the effects of market volatilities on LG Energy and Aprogen Healthcare 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 LG Energy with a short position of Aprogen Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of LG Energy and Aprogen Healthcare.
Diversification Opportunities for LG Energy and Aprogen Healthcare
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 373220 and Aprogen is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding LG Energy Solution and Aprogen Healthcare Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aprogen Healthcare Games and LG Energy 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 LG Energy Solution are associated (or correlated) with Aprogen Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aprogen Healthcare Games has no effect on the direction of LG Energy i.e., LG Energy and Aprogen Healthcare go up and down completely randomly.
Pair Corralation between LG Energy and Aprogen Healthcare
Assuming the 90 days trading horizon LG Energy Solution is expected to generate 0.59 times more return on investment than Aprogen Healthcare. However, LG Energy Solution is 1.69 times less risky than Aprogen Healthcare. It trades about -0.14 of its potential returns per unit of risk. Aprogen Healthcare Games is currently generating about -0.13 per unit of risk. If you would invest 37,200,000 in LG Energy Solution on October 20, 2024 and sell it today you would lose (2,150,000) from holding LG Energy Solution or give up 5.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
LG Energy Solution vs. Aprogen Healthcare Games
Performance |
| Timeline |
| LG Energy Solution |
| Aprogen Healthcare Games |
LG Energy and Aprogen Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LG Energy and Aprogen Healthcare
The main advantage of trading using opposite LG Energy and Aprogen Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LG Energy position performs unexpectedly, Aprogen Healthcare 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 Aprogen Healthcare will offset losses from the drop in Aprogen Healthcare's long position.| LG Energy vs. SEOWONINTECHCoLtd | LG Energy vs. KMH Hitech Co | LG Energy vs. Spolytech Co | LG Energy vs. Mobile Appliance |
| Aprogen Healthcare vs. Hansol Homedeco Co | Aprogen Healthcare vs. Kukil Metal Co | Aprogen Healthcare vs. Dongil Metal Co | Aprogen Healthcare vs. Kolon Plastics |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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