Correlation Between Apple and RETAIL FOOD
Can any of the company-specific risk be diversified away by investing in both Apple and RETAIL FOOD 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 RETAIL FOOD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and RETAIL FOOD GROUP, you can compare the effects of market volatilities on Apple and RETAIL FOOD 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 RETAIL FOOD. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and RETAIL FOOD.
Diversification Opportunities for Apple and RETAIL FOOD
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Apple and RETAIL is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and RETAIL FOOD GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RETAIL FOOD GROUP 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 RETAIL FOOD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RETAIL FOOD GROUP has no effect on the direction of Apple i.e., Apple and RETAIL FOOD go up and down completely randomly.
Pair Corralation between Apple and RETAIL FOOD
Assuming the 90 days trading horizon Apple Inc is expected to generate 0.51 times more return on investment than RETAIL FOOD. However, Apple Inc is 1.97 times less risky than RETAIL FOOD. It trades about 0.0 of its potential returns per unit of risk. RETAIL FOOD GROUP is currently generating about -0.18 per unit of risk. If you would invest 22,980 in Apple Inc on December 5, 2024 and sell it today you would lose (270.00) from holding Apple Inc or give up 1.17% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Apple Inc vs. RETAIL FOOD GROUP
Performance |
Timeline |
Apple Inc |
RETAIL FOOD GROUP |
Apple and RETAIL FOOD Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Apple and RETAIL FOOD
The main advantage of trading using opposite Apple and RETAIL FOOD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, RETAIL FOOD 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 RETAIL FOOD will offset losses from the drop in RETAIL FOOD's long position.Apple vs. HAVERTY FURNITURE A | Apple vs. CENTURIA OFFICE REIT | Apple vs. ANGI Homeservices | Apple vs. SAN MIGUEL BREWERY |
RETAIL FOOD vs. ADRIATIC METALS LS 013355 | RETAIL FOOD vs. Calibre Mining Corp | RETAIL FOOD vs. Perseus Mining Limited | RETAIL FOOD vs. Sunny Optical Technology |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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