Correlation Between Woori Financial and ADMA Biologics
Can any of the company-specific risk be diversified away by investing in both Woori Financial and ADMA Biologics 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 Woori Financial and ADMA Biologics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and ADMA Biologics, you can compare the effects of market volatilities on Woori Financial and ADMA Biologics 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 Woori Financial with a short position of ADMA Biologics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and ADMA Biologics.
Diversification Opportunities for Woori Financial and ADMA Biologics
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and ADMA is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and ADMA Biologics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADMA Biologics and Woori Financial 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 Woori Financial Group are associated (or correlated) with ADMA Biologics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADMA Biologics has no effect on the direction of Woori Financial i.e., Woori Financial and ADMA Biologics go up and down completely randomly.
Pair Corralation between Woori Financial and ADMA Biologics
Allowing for the 90-day total investment horizon Woori Financial is expected to generate 11.11 times less return on investment than ADMA Biologics. But when comparing it to its historical volatility, Woori Financial Group is 4.79 times less risky than ADMA Biologics. It trades about 0.1 of its potential returns per unit of risk. ADMA Biologics is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,671 in ADMA Biologics on August 30, 2024 and sell it today you would earn a total of 512.00 from holding ADMA Biologics or generate 30.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. ADMA Biologics
Performance |
| Timeline |
| Woori Financial Group |
| ADMA Biologics |
Woori Financial and ADMA Biologics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and ADMA Biologics
The main advantage of trading using opposite Woori Financial and ADMA Biologics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, ADMA Biologics 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 ADMA Biologics will offset losses from the drop in ADMA Biologics' long position.| Woori Financial vs. JPMorgan Chase Co | Woori Financial vs. Citigroup | Woori Financial vs. Wells Fargo | Woori Financial vs. Toronto Dominion Bank |
| ADMA Biologics vs. Atara Biotherapeutics | ADMA Biologics vs. Fate Therapeutics | ADMA Biologics vs. Sana Biotechnology | ADMA Biologics vs. Caribou Biosciences |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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