Correlation Between Apple and VIENNA INSURANCE

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

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

Diversification Opportunities for Apple and VIENNA INSURANCE

-0.26

Correlation Coefficient

Apple  VIENNA INSURANCE

Very good diversification

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

Pair Corralation between Apple and VIENNA INSURANCE

Assuming the 90 days trading horizon Apple Inc is expected to generate 1.65 times more return on investment than VIENNA INSURANCE. However, Apple is 1.65 times more volatile than VIENNA INSURANCE GR. It trades about 0.18 of its potential returns per unit of risk. VIENNA INSURANCE GR is currently generating about 0.05 per unit of risk. If you would invest  15,603  in Apple Inc on September 18, 2024 and sell it today you would earn a total of  8,482  from holding Apple Inc or generate 54.36% return on investment over 90 days.

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

Apple Inc  vs.  VIENNA INSURANCE GR

Apple Inc

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Apple unveiled solid returns over the last few months and may actually be approaching a breakup point.

VIENNA INSURANCE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VIENNA INSURANCE GR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, VIENNA INSURANCE is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Apple and VIENNA INSURANCE

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

The idea behind Apple Inc and VIENNA INSURANCE GR 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..