Correlation Between Apogee Therapeutics, and Shake Shack

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

By analyzing existing cross correlation between Apogee Therapeutics, Common and Shake Shack, you can compare the effects of market volatilities on Apogee Therapeutics, and Shake Shack 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 Apogee Therapeutics, with a short position of Shake Shack. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apogee Therapeutics, and Shake Shack.

Diversification Opportunities for Apogee Therapeutics, and Shake Shack

-0.47

Correlation Coefficient

Apogee Therapeutics,  Shake Shack

Very good diversification

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

Pair Corralation between Apogee Therapeutics, and Shake Shack

Given the investment horizon of 90 days Apogee Therapeutics, is expected to generate 2.08 times less return on investment than Shake Shack. In addition to that, Apogee Therapeutics, is 2.2 times more volatile than Shake Shack. It trades about 0.06 of its total potential returns per unit of risk. Shake Shack is currently generating about 0.29 per unit of volatility. If you would invest  11,649  in Shake Shack on September 18, 2024 and sell it today you would earn a total of  1,510  from holding Shake Shack or generate 12.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Apogee Therapeutics, Common  vs.  Shake Shack

Apogee Therapeutics,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apogee Therapeutics, Common has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Shake Shack

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Shake Shack are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Shake Shack disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apogee Therapeutics, and Shake Shack

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

The idea behind Apogee Therapeutics, Common and Shake Shack 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.