Correlation Between AptaBio Therapeutics and Okins Electronics
Can any of the company-specific risk be diversified away by investing in both AptaBio Therapeutics and Okins Electronics 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 AptaBio Therapeutics and Okins Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AptaBio Therapeutics and Okins Electronics Co, you can compare the effects of market volatilities on AptaBio Therapeutics and Okins Electronics 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 AptaBio Therapeutics with a short position of Okins Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of AptaBio Therapeutics and Okins Electronics.
Diversification Opportunities for AptaBio Therapeutics and Okins Electronics
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AptaBio and Okins is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding AptaBio Therapeutics and Okins Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Okins Electronics and AptaBio Therapeutics 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 AptaBio Therapeutics are associated (or correlated) with Okins Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Okins Electronics has no effect on the direction of AptaBio Therapeutics i.e., AptaBio Therapeutics and Okins Electronics go up and down completely randomly.
Pair Corralation between AptaBio Therapeutics and Okins Electronics
Assuming the 90 days trading horizon AptaBio Therapeutics is expected to generate 13.78 times less return on investment than Okins Electronics. But when comparing it to its historical volatility, AptaBio Therapeutics is 1.11 times less risky than Okins Electronics. It trades about 0.0 of its potential returns per unit of risk. Okins Electronics Co is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 427,000 in Okins Electronics Co on October 5, 2024 and sell it today you would earn a total of 51,000 from holding Okins Electronics Co or generate 11.94% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
AptaBio Therapeutics vs. Okins Electronics Co
Performance |
Timeline |
AptaBio Therapeutics |
Okins Electronics |
AptaBio Therapeutics and Okins Electronics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with AptaBio Therapeutics and Okins Electronics
The main advantage of trading using opposite AptaBio Therapeutics and Okins Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AptaBio Therapeutics position performs unexpectedly, Okins Electronics 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 Okins Electronics will offset losses from the drop in Okins Electronics' long position.AptaBio Therapeutics vs. ABL Bio | AptaBio Therapeutics vs. Helixmith Co | AptaBio Therapeutics vs. OliX PharmaceuticalsInc | AptaBio Therapeutics vs. Oscotec |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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