Correlation Between Apollo Global and WisdomTree

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

Diversification Opportunities for Apollo Global and WisdomTree

0.91

Correlation Coefficient

Apollo Global  WisdomTree

Almost no diversification

The 3 months correlation between Apollo and WisdomTree is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Management and WisdomTree in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree 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 WisdomTree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree has no effect on the direction of Apollo Global i.e., Apollo Global and WisdomTree go up and down completely randomly.

Pair Corralation between Apollo Global and WisdomTree

Considering the 90-day investment horizon Apollo Global Management is expected to under-perform the WisdomTree. In addition to that, Apollo Global is 1.36 times more volatile than WisdomTree. It trades about -0.1 of its total potential returns per unit of risk. WisdomTree is currently generating about -0.11 per unit of volatility. If you would invest  1,040  in WisdomTree on December 29, 2024 and sell it today you would lose (123.00) from holding WisdomTree or give up 11.83% of portfolio value over 90 days.

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

Apollo Global Management  vs.  WisdomTree

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.

WisdomTree

Risk-Adjusted Performance

Very Weak

Over the last 90 days WisdomTree has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Apollo Global and WisdomTree

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

The idea behind Apollo Global Management and WisdomTree 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 Transaction History module to view history of all your transactions and understand their impact on performance.