Correlation Between Korea Electric and AC Immune
Can any of the company-specific risk be diversified away by investing in both Korea Electric and AC Immune 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 Korea Electric and AC Immune into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Electric Power and AC Immune, you can compare the effects of market volatilities on Korea Electric and AC Immune 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 Korea Electric with a short position of AC Immune. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Electric and AC Immune.
Diversification Opportunities for Korea Electric and AC Immune
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and ACIU is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Korea Electric Power and AC Immune in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AC Immune and Korea Electric 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 Korea Electric Power are associated (or correlated) with AC Immune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AC Immune has no effect on the direction of Korea Electric i.e., Korea Electric and AC Immune go up and down completely randomly.
Pair Corralation between Korea Electric and AC Immune
Considering the 90-day investment horizon Korea Electric is expected to generate 3.25 times less return on investment than AC Immune. But when comparing it to its historical volatility, Korea Electric Power is 2.42 times less risky than AC Immune. It trades about 0.1 of its potential returns per unit of risk. AC Immune is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 300.00 in AC Immune on August 28, 2024 and sell it today you would earn a total of 41.00 from holding AC Immune or generate 13.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Electric Power vs. AC Immune
Performance |
| Timeline |
| Korea Electric Power |
| AC Immune |
Korea Electric and AC Immune Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Electric and AC Immune
The main advantage of trading using opposite Korea Electric and AC Immune positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Electric position performs unexpectedly, AC Immune 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 AC Immune will offset losses from the drop in AC Immune's long position.| Korea Electric vs. Dominion Energy | Korea Electric vs. Consolidated Edison | Korea Electric vs. Eversource Energy | Korea Electric vs. FirstEnergy |
| AC Immune vs. Eliem Therapeutics | AC Immune vs. Scpharmaceuticals | AC Immune vs. Milestone Pharmaceuticals | AC Immune vs. Seres Therapeutics |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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