Correlation Between Apollo Medical and Korn Ferry

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Can any of the company-specific risk be diversified away by investing in both Apollo Medical and Korn Ferry 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 Apollo Medical and Korn Ferry into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Medical Holdings and Korn Ferry, you can compare the effects of market volatilities on Apollo Medical and Korn Ferry 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 Apollo Medical with a short position of Korn Ferry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Medical and Korn Ferry.

Diversification Opportunities for Apollo Medical and Korn Ferry

0.73
  Correlation Coefficient

Poor diversification

The 3 months correlation between Apollo and Korn is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Medical Holdings and Korn Ferry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korn Ferry and Apollo Medical 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 Apollo Medical Holdings are associated (or correlated) with Korn Ferry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korn Ferry has no effect on the direction of Apollo Medical i.e., Apollo Medical and Korn Ferry go up and down completely randomly.

Pair Corralation between Apollo Medical and Korn Ferry

Assuming the 90 days horizon Apollo Medical is expected to generate 1.34 times less return on investment than Korn Ferry. In addition to that, Apollo Medical is 1.15 times more volatile than Korn Ferry. It trades about 0.03 of its total potential returns per unit of risk. Korn Ferry is currently generating about 0.05 per unit of volatility. If you would invest  4,540  in Korn Ferry on September 19, 2024 and sell it today you would earn a total of  2,210  from holding Korn Ferry or generate 48.68% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Apollo Medical Holdings  vs.  Korn Ferry

 Performance 
       Timeline  
Apollo Medical Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Apollo Medical Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Apollo Medical is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.
Korn Ferry 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Korn Ferry are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Korn Ferry is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Apollo Medical and Korn Ferry Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Apollo Medical and Korn Ferry

The main advantage of trading using opposite Apollo Medical and Korn Ferry positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Medical position performs unexpectedly, Korn Ferry 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 Korn Ferry will offset losses from the drop in Korn Ferry's long position.
The idea behind Apollo Medical Holdings and Korn Ferry 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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