Correlation Between Woori Financial and APx Acquisition
Can any of the company-specific risk be diversified away by investing in both Woori Financial and APx Acquisition 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 APx Acquisition 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 APx Acquisition I, you can compare the effects of market volatilities on Woori Financial and APx Acquisition 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 APx Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and APx Acquisition.
Diversification Opportunities for Woori Financial and APx Acquisition
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Woori and APx is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and APx Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APx Acquisition I 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 APx Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APx Acquisition I has no effect on the direction of Woori Financial i.e., Woori Financial and APx Acquisition go up and down completely randomly.
Pair Corralation between Woori Financial and APx Acquisition
Allowing for the 90-day total investment horizon Woori Financial Group is expected to under-perform the APx Acquisition. In addition to that, Woori Financial is 1.2 times more volatile than APx Acquisition I. It trades about -0.1 of its total potential returns per unit of risk. APx Acquisition I is currently generating about 0.01 per unit of volatility. If you would invest 1,186 in APx Acquisition I on September 13, 2024 and sell it today you would earn a total of 2.00 from holding APx Acquisition I or generate 0.17% 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. APx Acquisition I
Performance |
| Timeline |
| Woori Financial Group |
| APx Acquisition I |
Woori Financial and APx Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and APx Acquisition
The main advantage of trading using opposite Woori Financial and APx Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, APx Acquisition 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 APx Acquisition will offset losses from the drop in APx Acquisition's long position.| Woori Financial vs. Banco Santander Brasil | Woori Financial vs. CrossFirst Bankshares | Woori Financial vs. Banco Bradesco SA | Woori Financial vs. CF Bankshares |
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 CEOs Directory module to screen CEOs from public companies around the world.
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