Correlation Between Apollo Power and Mordechai Aviv

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

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

Diversification Opportunities for Apollo Power and Mordechai Aviv

0.37

Correlation Coefficient

Apollo Power  Mordechai Aviv

Weak diversification

The 3 months correlation between Apollo and Mordechai is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Power and Mordechai Aviv Taasiot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mordechai Aviv Taasiot and Apollo Power 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 Power are associated (or correlated) with Mordechai Aviv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mordechai Aviv Taasiot has no effect on the direction of Apollo Power i.e., Apollo Power and Mordechai Aviv go up and down completely randomly.

Pair Corralation between Apollo Power and Mordechai Aviv

Assuming the 90 days trading horizon Apollo Power is expected to generate 3.25 times more return on investment than Mordechai Aviv. However, Apollo Power is 3.25 times more volatile than Mordechai Aviv Taasiot. It trades about 0.08 of its potential returns per unit of risk. Mordechai Aviv Taasiot is currently generating about -0.02 per unit of risk. If you would invest  28,380  in Apollo Power on November 29, 2024 and sell it today you would earn a total of  5,510  from holding Apollo Power or generate 19.42% return on investment over 90 days.

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

Apollo Power  vs.  Mordechai Aviv Taasiot

Apollo Power

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Power are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Apollo Power sustained solid returns over the last few months and may actually be approaching a breakup point.

Mordechai Aviv Taasiot

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mordechai Aviv Taasiot has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Mordechai Aviv is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Apollo Power and Mordechai Aviv

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

The idea behind Apollo Power and Mordechai Aviv Taasiot 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.