Correlation Between Apple and AXMIN

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

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

Diversification Opportunities for Apple and AXMIN

0.0

Correlation Coefficient

Apple  AXMIN

Pay attention - limited upside

The 3 months correlation between Apple and AXMIN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and AXMIN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AXMIN Inc 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 AXMIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AXMIN Inc has no effect on the direction of Apple i.e., Apple and AXMIN go up and down completely randomly.

Pair Corralation between Apple and AXMIN

If you would invest  20,316  in Apple Inc on September 23, 2024 and sell it today you would earn a total of  3,444  from holding Apple Inc or generate 16.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

Apple Inc  vs.  AXMIN Inc

Apple Inc

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, Apple exhibited solid returns over the last few months and may actually be approaching a breakup point.

AXMIN Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AXMIN Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, AXMIN is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Apple and AXMIN

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

The idea behind Apple Inc and AXMIN Inc 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.