Correlation Between Intracellular and Aptorum Group

Can any of the company-specific risk be diversified away by investing in both Intracellular and Aptorum Group 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 Intracellular and Aptorum Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intracellular Th and Aptorum Group Ltd, you can compare the effects of market volatilities on Intracellular and Aptorum Group 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 Intracellular with a short position of Aptorum Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intracellular and Aptorum Group.

Diversification Opportunities for Intracellular and Aptorum Group

-0.51

Correlation Coefficient

Intracellular  Aptorum Group

Excellent diversification

The 3 months correlation between Intracellular and Aptorum is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Intracellular Th and Aptorum Group Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptorum Group and Intracellular 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 Intracellular Th are associated (or correlated) with Aptorum Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptorum Group has no effect on the direction of Intracellular i.e., Intracellular and Aptorum Group go up and down completely randomly.

Pair Corralation between Intracellular and Aptorum Group

Given the investment horizon of 90 days Intracellular Th is expected to under-perform the Aptorum Group. But the stock apears to be less risky and, when comparing its historical volatility, Intracellular Th is 13.91 times less risky than Aptorum Group. The stock trades about -0.09 of its potential returns per unit of risk. The Aptorum Group Ltd is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  136.00  in Aptorum Group Ltd on October 6, 2024 and sell it today you would earn a total of  78.00  from holding Aptorum Group Ltd or generate 57.35% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	97.62%
Values	Daily Returns

Intracellular Th  vs.  Aptorum Group Ltd

Intracellular Th

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intracellular Th are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain fundamental indicators, Intracellular demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Aptorum Group

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Aptorum Group Ltd are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Aptorum Group displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Intracellular and Aptorum Group

The main advantage of trading using opposite Intracellular and Aptorum Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intracellular position performs unexpectedly, Aptorum Group 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 Aptorum Group will offset losses from the drop in Aptorum Group's long position.

The idea behind Intracellular Th and Aptorum Group Ltd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.