Correlation Between Apollo Medical and Suzano SA
Can any of the company-specific risk be diversified away by investing in both Apollo Medical and Suzano SA 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 Suzano SA 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 Suzano SA, you can compare the effects of market volatilities on Apollo Medical and Suzano SA 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 Suzano SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Medical and Suzano SA.
Diversification Opportunities for Apollo Medical and Suzano SA
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Apollo and Suzano is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Medical Holdings and Suzano SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzano SA 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 Suzano SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzano SA has no effect on the direction of Apollo Medical i.e., Apollo Medical and Suzano SA go up and down completely randomly.
Pair Corralation between Apollo Medical and Suzano SA
Assuming the 90 days horizon Apollo Medical Holdings is expected to under-perform the Suzano SA. In addition to that, Apollo Medical is 2.02 times more volatile than Suzano SA. It trades about -0.19 of its total potential returns per unit of risk. Suzano SA is currently generating about -0.35 per unit of volatility. If you would invest 1,030 in Suzano SA on December 5, 2024 and sell it today you would lose (105.00) from holding Suzano SA or give up 10.19% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
Apollo Medical Holdings vs. Suzano SA
Performance |
Timeline |
Apollo Medical Holdings |
Suzano SA |
Apollo Medical and Suzano SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Apollo Medical and Suzano SA
The main advantage of trading using opposite Apollo Medical and Suzano SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Medical position performs unexpectedly, Suzano SA 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 Suzano SA will offset losses from the drop in Suzano SA's long position.Apollo Medical vs. OPKO HEALTH | Apollo Medical vs. Mount Gibson Iron | Apollo Medical vs. Khiron Life Sciences | Apollo Medical vs. Cardinal Health |
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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