Correlation Between Apollo Investment and METTLER TOLEDO

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

By analyzing existing cross correlation between Apollo Investment Corp and METTLER TOLEDO INTL, you can compare the effects of market volatilities on Apollo Investment and METTLER TOLEDO 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 Investment with a short position of METTLER TOLEDO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and METTLER TOLEDO.

Diversification Opportunities for Apollo Investment and METTLER TOLEDO

-0.73

Correlation Coefficient

Apollo Investment  METTLER TOLEDO

Pay attention - limited upside

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

Pair Corralation between Apollo Investment and METTLER TOLEDO

Assuming the 90 days trading horizon Apollo Investment is expected to generate 5.7 times less return on investment than METTLER TOLEDO. But when comparing it to its historical volatility, Apollo Investment Corp is 1.27 times less risky than METTLER TOLEDO. It trades about 0.02 of its potential returns per unit of risk. METTLER TOLEDO INTL is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  113,850  in METTLER TOLEDO INTL on September 23, 2024 and sell it today you would earn a total of  2,350  from holding METTLER TOLEDO INTL or generate 2.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Apollo Investment Corp  vs.  METTLER TOLEDO INTL

Apollo Investment Corp

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Investment Corp are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Apollo Investment may actually be approaching a critical reversion point that can send shares even higher in January 2025.

METTLER TOLEDO INTL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days METTLER TOLEDO INTL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, METTLER TOLEDO is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Apollo Investment and METTLER TOLEDO

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

The idea behind Apollo Investment Corp and METTLER TOLEDO INTL 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.