Correlation Between Apple and JLT MOBILE

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

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

Diversification Opportunities for Apple and JLT MOBILE

0.26

Correlation Coefficient

Apple  JLT MOBILE

Modest diversification

The 3 months correlation between Apple and JLT is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and JLT MOBILE PUTER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLT MOBILE PUTER 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 JLT MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLT MOBILE PUTER has no effect on the direction of Apple i.e., Apple and JLT MOBILE go up and down completely randomly.

Pair Corralation between Apple and JLT MOBILE

Assuming the 90 days trading horizon Apple Inc is expected to under-perform the JLT MOBILE. But the stock apears to be less risky and, when comparing its historical volatility, Apple Inc is 3.67 times less risky than JLT MOBILE. The stock trades about -0.05 of its potential returns per unit of risk. The JLT MOBILE PUTER is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  16.00  in JLT MOBILE PUTER on December 10, 2024 and sell it today you would earn a total of  4.00  from holding JLT MOBILE PUTER or generate 25.0% return on investment over 90 days.

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

Apple Inc  vs.  JLT MOBILE PUTER

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. In spite of latest unsteady performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

JLT MOBILE PUTER

Risk-Adjusted Performance

Very Weak

Over the last 90 days JLT MOBILE PUTER has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, JLT MOBILE 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 JLT MOBILE

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

The idea behind Apple Inc and JLT MOBILE PUTER 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.