Correlation Between Apple and Westag Getalit

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

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

Diversification Opportunities for Apple and Westag Getalit

-0.47

Correlation Coefficient

Apple  Westag Getalit

Very good diversification

The 3 months correlation between Apple and Westag is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Westag Getalit AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westag Getalit AG 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 Westag Getalit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westag Getalit AG has no effect on the direction of Apple i.e., Apple and Westag Getalit go up and down completely randomly.

Pair Corralation between Apple and Westag Getalit

Assuming the 90 days trading horizon Apple Inc is expected to generate 0.26 times more return on investment than Westag Getalit. However, Apple Inc is 3.79 times less risky than Westag Getalit. It trades about 0.64 of its potential returns per unit of risk. Westag Getalit AG is currently generating about 0.03 per unit of risk. If you would invest  21,600  in Apple Inc on September 19, 2024 and sell it today you would earn a total of  2,485  from holding Apple Inc or generate 11.5% return on investment over 90 days.

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

Apple Inc  vs.  Westag Getalit AG

Apple Inc

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 18 (%) 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.

Westag Getalit AG

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Westag Getalit AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Westag Getalit 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 Westag Getalit

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

The idea behind Apple Inc and Westag Getalit AG 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.