Correlation Between Korea Electric and Lipella Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Korea Electric and Lipella Pharmaceuticals 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 Lipella Pharmaceuticals 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 Lipella Pharmaceuticals Common, you can compare the effects of market volatilities on Korea Electric and Lipella Pharmaceuticals 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 Lipella Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Electric and Lipella Pharmaceuticals.
Diversification Opportunities for Korea Electric and Lipella Pharmaceuticals
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Korea and Lipella is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Korea Electric Power and Lipella Pharmaceuticals Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lipella Pharmaceuticals 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 Lipella Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lipella Pharmaceuticals has no effect on the direction of Korea Electric i.e., Korea Electric and Lipella Pharmaceuticals go up and down completely randomly.
Pair Corralation between Korea Electric and Lipella Pharmaceuticals
Considering the 90-day investment horizon Korea Electric Power is expected to generate 0.22 times more return on investment than Lipella Pharmaceuticals. However, Korea Electric Power is 4.48 times less risky than Lipella Pharmaceuticals. It trades about 0.05 of its potential returns per unit of risk. Lipella Pharmaceuticals Common is currently generating about -0.01 per unit of risk. If you would invest 729.00 in Korea Electric Power on August 29, 2024 and sell it today you would earn a total of 149.00 from holding Korea Electric Power or generate 20.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Electric Power vs. Lipella Pharmaceuticals Common
Performance |
| Timeline |
| Korea Electric Power |
| Lipella Pharmaceuticals |
Korea Electric and Lipella Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Electric and Lipella Pharmaceuticals
The main advantage of trading using opposite Korea Electric and Lipella Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Electric position performs unexpectedly, Lipella Pharmaceuticals 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 Lipella Pharmaceuticals will offset losses from the drop in Lipella Pharmaceuticals' long position.| Korea Electric vs. Enel Chile SA | Korea Electric vs. Centrais Eltricas Brasileiras | Korea Electric vs. Central Puerto SA | Korea Electric vs. CMS Energy |
| Lipella Pharmaceuticals vs. Senti Biosciences | Lipella Pharmaceuticals vs. Fennec Pharmaceuticals | Lipella Pharmaceuticals vs. Monopar Therapeutics | Lipella Pharmaceuticals vs. Akeso, Inc |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |