Correlation Between Apollo Global and Global Ferronickel

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

By analyzing existing cross correlation between Apollo Global Capital and Global Ferronickel Holdings, you can compare the effects of market volatilities on Apollo Global and Global Ferronickel 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 Apollo Global with a short position of Global Ferronickel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Global and Global Ferronickel.

Diversification Opportunities for Apollo Global and Global Ferronickel

-0.52

Correlation Coefficient

Apollo Global  Global Ferronickel

Excellent diversification

The 3 months correlation between Apollo and Global is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Capital and Global Ferronickel Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ferronickel and Apollo Global 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 Apollo Global Capital are associated (or correlated) with Global Ferronickel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ferronickel has no effect on the direction of Apollo Global i.e., Apollo Global and Global Ferronickel go up and down completely randomly.

Pair Corralation between Apollo Global and Global Ferronickel

Assuming the 90 days trading horizon Apollo Global Capital is expected to generate 3.86 times more return on investment than Global Ferronickel. However, Apollo Global is 3.86 times more volatile than Global Ferronickel Holdings. It trades about 0.04 of its potential returns per unit of risk. Global Ferronickel Holdings is currently generating about 0.07 per unit of risk. If you would invest  0.40  in Apollo Global Capital on December 27, 2024 and sell it today you would earn a total of  0.01  from holding Apollo Global Capital or generate 2.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.36%
Values	Daily Returns

Apollo Global Capital  vs.  Global Ferronickel Holdings

Apollo Global Capital

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Capital are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Apollo Global exhibited solid returns over the last few months and may actually be approaching a breakup point.

Global Ferronickel

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Ferronickel Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Global Ferronickel may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Apollo Global and Global Ferronickel

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

The idea behind Apollo Global Capital and Global Ferronickel Holdings 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.

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 Global Correlations module to find global opportunities by holding instruments from different markets.