Correlation Between Apple and Genesis Land

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

By analyzing existing cross correlation between Apple Inc CDR and Genesis Land Development, you can compare the effects of market volatilities on Apple and Genesis Land 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 Apple with a short position of Genesis Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Genesis Land.

Diversification Opportunities for Apple and Genesis Land

0.63

Correlation Coefficient

Apple  Genesis Land

Poor diversification

The 3 months correlation between Apple and Genesis is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc CDR and Genesis Land Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Land Development and Apple 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 Apple Inc CDR are associated (or correlated) with Genesis Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Land Development has no effect on the direction of Apple i.e., Apple and Genesis Land go up and down completely randomly.

Pair Corralation between Apple and Genesis Land

Assuming the 90 days trading horizon Apple Inc CDR is expected to under-perform the Genesis Land. In addition to that, Apple is 1.36 times more volatile than Genesis Land Development. It trades about -0.13 of its total potential returns per unit of risk. Genesis Land Development is currently generating about -0.02 per unit of volatility. If you would invest  330.00  in Genesis Land Development on December 28, 2024 and sell it today you would lose (8.00) from holding Genesis Land Development or give up 2.42% of portfolio value over 90 days.

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

Apple Inc CDR  vs.  Genesis Land Development

Apple Inc CDR

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apple Inc CDR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Genesis Land Development

Risk-Adjusted Performance

Very Weak

Over the last 90 days Genesis Land Development has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental indicators, Genesis Land is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Apple and Genesis Land

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

The idea behind Apple Inc CDR and Genesis Land Development 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.