Correlation Between Apple and AMETEK,

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

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

Diversification Opportunities for Apple and AMETEK,

0.59

Correlation Coefficient

Apple  AMETEK,

Very weak diversification

The 3 months correlation between Apple and AMETEK, is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and AMETEK, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMETEK, 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 AMETEK,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMETEK, has no effect on the direction of Apple i.e., Apple and AMETEK, go up and down completely randomly.

Pair Corralation between Apple and AMETEK,

Assuming the 90 days trading horizon Apple Inc is expected to generate 1.37 times more return on investment than AMETEK,. However, Apple is 1.37 times more volatile than AMETEK,. It trades about -0.11 of its potential returns per unit of risk. AMETEK, is currently generating about -0.21 per unit of risk. If you would invest  7,461  in Apple Inc on October 13, 2024 and sell it today you would lose (259.00) from holding Apple Inc or give up 3.47% of portfolio value over 90 days.

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

Apple Inc  vs.  AMETEK,

Apple Inc

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Apple may actually be approaching a critical reversion point that can send shares even higher in February 2025.

AMETEK,

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AMETEK, are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, AMETEK, sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apple and AMETEK,

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

The idea behind Apple Inc and AMETEK, 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.

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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.