Correlation Between Apollo Global and Marygold Companies

Can any of the company-specific risk be diversified away by investing in both Apollo Global and Marygold Companies 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 Marygold Companies 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 Marygold Companies, you can compare the effects of market volatilities on Apollo Global and Marygold Companies 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 Marygold Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Global and Marygold Companies.

Diversification Opportunities for Apollo Global and Marygold Companies

0.57

Correlation Coefficient

Apollo Global  Marygold Companies

Very weak diversification

The 3 months correlation between Apollo and Marygold is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Management and Marygold Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marygold Companies 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 Marygold Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marygold Companies has no effect on the direction of Apollo Global i.e., Apollo Global and Marygold Companies go up and down completely randomly.

Pair Corralation between Apollo Global and Marygold Companies

Considering the 90-day investment horizon Apollo Global Management is expected to generate 0.4 times more return on investment than Marygold Companies. However, Apollo Global Management is 2.47 times less risky than Marygold Companies. It trades about -0.11 of its potential returns per unit of risk. Marygold Companies is currently generating about -0.13 per unit of risk. If you would invest  17,114  in Apollo Global Management on December 21, 2024 and sell it today you would lose (2,637) from holding Apollo Global Management or give up 15.41% of portfolio value over 90 days.

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

Apollo Global Management  vs.  Marygold Companies

Apollo Global Management

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apollo Global Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Marygold Companies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Marygold Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's essential indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Apollo Global and Marygold Companies

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

The idea behind Apollo Global Management and Marygold Companies 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.