Correlation Between Korea Electric and Biomea Fusion
Can any of the company-specific risk be diversified away by investing in both Korea Electric and Biomea Fusion 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 Biomea Fusion 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 Biomea Fusion, you can compare the effects of market volatilities on Korea Electric and Biomea Fusion 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 Biomea Fusion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Electric and Biomea Fusion.
Diversification Opportunities for Korea Electric and Biomea Fusion
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Korea and Biomea is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Korea Electric Power and Biomea Fusion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biomea Fusion 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 Biomea Fusion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biomea Fusion has no effect on the direction of Korea Electric i.e., Korea Electric and Biomea Fusion go up and down completely randomly.
Pair Corralation between Korea Electric and Biomea Fusion
Considering the 90-day investment horizon Korea Electric is expected to generate 6.55 times less return on investment than Biomea Fusion. But when comparing it to its historical volatility, Korea Electric Power is 3.71 times less risky than Biomea Fusion. It trades about 0.02 of its potential returns per unit of risk. Biomea Fusion is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 677.00 in Biomea Fusion on August 26, 2024 and sell it today you would lose (33.00) from holding Biomea Fusion or give up 4.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Electric Power vs. Biomea Fusion
Performance |
| Timeline |
| Korea Electric Power |
| Biomea Fusion |
Korea Electric and Biomea Fusion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Electric and Biomea Fusion
The main advantage of trading using opposite Korea Electric and Biomea Fusion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Electric position performs unexpectedly, Biomea Fusion 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 Biomea Fusion will offset losses from the drop in Biomea Fusion's long position.| Korea Electric vs. Dominion Energy | Korea Electric vs. Consolidated Edison | Korea Electric vs. Eversource Energy | Korea Electric vs. FirstEnergy |
| Biomea Fusion vs. Edgewise Therapeutics | Biomea Fusion vs. Werewolf Therapeutics | Biomea Fusion vs. Cullinan Oncology LLC | Biomea Fusion vs. Design 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |