Correlation Between Woori Financial and Rigel Pharmaceuticals
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Rigel 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 Woori Financial and Rigel Pharmaceuticals 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 Rigel Pharmaceuticals, you can compare the effects of market volatilities on Woori Financial and Rigel 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 Woori Financial with a short position of Rigel Pharmaceuticals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Rigel Pharmaceuticals.
Diversification Opportunities for Woori Financial and Rigel Pharmaceuticals
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Woori and Rigel is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Rigel Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rigel Pharmaceuticals 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 Rigel Pharmaceuticals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rigel Pharmaceuticals has no effect on the direction of Woori Financial i.e., Woori Financial and Rigel Pharmaceuticals go up and down completely randomly.
Pair Corralation between Woori Financial and Rigel Pharmaceuticals
Allowing for the 90-day total investment horizon Woori Financial is expected to generate 6.22 times less return on investment than Rigel Pharmaceuticals. But when comparing it to its historical volatility, Woori Financial Group is 3.13 times less risky than Rigel Pharmaceuticals. It trades about 0.06 of its potential returns per unit of risk. Rigel Pharmaceuticals is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,625 in Rigel Pharmaceuticals on December 11, 2024 and sell it today you would earn a total of 328.00 from holding Rigel Pharmaceuticals or generate 20.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Rigel Pharmaceuticals
Performance |
| Timeline |
| Woori Financial Group |
| Rigel Pharmaceuticals |
Woori Financial and Rigel Pharmaceuticals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Rigel Pharmaceuticals
The main advantage of trading using opposite Woori Financial and Rigel Pharmaceuticals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Rigel 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 Rigel Pharmaceuticals will offset losses from the drop in Rigel Pharmaceuticals' long position.| Woori Financial vs. Shinhan Financial Group | Woori Financial vs. KB Financial Group | Woori Financial vs. Banco De Chile | Woori Financial vs. Orix Corp Ads |
| Rigel Pharmaceuticals vs. Fortress Biotech | Rigel Pharmaceuticals vs. Reviva Pharmaceuticals Holdings | Rigel Pharmaceuticals vs. Cidara Therapeutics | Rigel Pharmaceuticals vs. X4 Pharmaceuticals |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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