Correlation Between Apple and 26441CAX3

Can any of the company-specific risk be diversified away by investing in both Apple and 26441CAX3 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 26441CAX3 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apple Inc and DUKE ENERGY P, you can compare the effects of market volatilities on Apple and 26441CAX3 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 26441CAX3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and 26441CAX3.

Diversification Opportunities for Apple and 26441CAX3

0.5

Correlation Coefficient

Apple  26441CAX3

Very weak diversification

The 3 months correlation between Apple and 26441CAX3 is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and DUKE ENERGY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DUKE ENERGY P 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 are associated (or correlated) with 26441CAX3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DUKE ENERGY P has no effect on the direction of Apple i.e., Apple and 26441CAX3 go up and down completely randomly.

Pair Corralation between Apple and 26441CAX3

Given the investment horizon of 90 days Apple Inc is expected to under-perform the 26441CAX3. In addition to that, Apple is 2.26 times more volatile than DUKE ENERGY P. It trades about -0.14 of its total potential returns per unit of risk. DUKE ENERGY P is currently generating about -0.11 per unit of volatility. If you would invest  9,590  in DUKE ENERGY P on December 24, 2024 and sell it today you would lose (519.00) from holding DUKE ENERGY P or give up 5.41% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Apple Inc  vs.  DUKE ENERGY P

Apple Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

DUKE ENERGY P

Risk-Adjusted Performance

Very Weak

Over the last 90 days DUKE ENERGY P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 26441CAX3 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Apple and 26441CAX3

The main advantage of trading using opposite Apple and 26441CAX3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, 26441CAX3 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 26441CAX3 will offset losses from the drop in 26441CAX3's long position.

The idea behind Apple Inc and DUKE ENERGY P 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.