Correlation Between Apollo Global and Aimia

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

By analyzing existing cross correlation between Apollo Global Management and Aimia Inc, you can compare the effects of market volatilities on Apollo Global and Aimia 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 Aimia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Global and Aimia.

Diversification Opportunities for Apollo Global and Aimia

-0.7

Correlation Coefficient

Apollo Global  Aimia

Excellent diversification

The 3 months correlation between Apollo and Aimia is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Management and Aimia Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aimia Inc 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 Management are associated (or correlated) with Aimia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aimia Inc has no effect on the direction of Apollo Global i.e., Apollo Global and Aimia go up and down completely randomly.

Pair Corralation between Apollo Global and Aimia

Considering the 90-day investment horizon Apollo Global Management is expected to generate 0.91 times more return on investment than Aimia. However, Apollo Global Management is 1.1 times less risky than Aimia. It trades about 0.34 of its potential returns per unit of risk. Aimia Inc is currently generating about -0.07 per unit of risk. If you would invest  11,101  in Apollo Global Management on August 31, 2024 and sell it today you would earn a total of  6,284  from holding Apollo Global Management or generate 56.61% return on investment over 90 days.

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

Apollo Global Management  vs.  Aimia Inc

Apollo Global Management

Risk-Adjusted Performance

26 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Management are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Apollo Global displayed solid returns over the last few months and may actually be approaching a breakup point.

Aimia Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aimia Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Apollo Global and Aimia

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

The idea behind Apollo Global Management and Aimia Inc 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.