Correlation Between Apogee Enterprises and Top KingWin

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

By analyzing existing cross correlation between Apogee Enterprises and Top KingWin, you can compare the effects of market volatilities on Apogee Enterprises and Top KingWin 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 Apogee Enterprises with a short position of Top KingWin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apogee Enterprises and Top KingWin.

Diversification Opportunities for Apogee Enterprises and Top KingWin

-0.08

Correlation Coefficient

Apogee Enterprises  Top KingWin

Good diversification

The 3 months correlation between Apogee and Top is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Apogee Enterprises and Top KingWin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Top KingWin and Apogee Enterprises 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 Apogee Enterprises are associated (or correlated) with Top KingWin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Top KingWin has no effect on the direction of Apogee Enterprises i.e., Apogee Enterprises and Top KingWin go up and down completely randomly.

Pair Corralation between Apogee Enterprises and Top KingWin

Given the investment horizon of 90 days Apogee Enterprises is expected to generate 0.17 times more return on investment than Top KingWin. However, Apogee Enterprises is 5.75 times less risky than Top KingWin. It trades about -0.49 of its potential returns per unit of risk. Top KingWin is currently generating about -0.15 per unit of risk. If you would invest  8,378  in Apogee Enterprises on September 28, 2024 and sell it today you would lose (1,146) from holding Apogee Enterprises or give up 13.68% of portfolio value over 90 days.

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

Apogee Enterprises  vs.  Top KingWin

Apogee Enterprises

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Apogee Enterprises are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Apogee Enterprises may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Top KingWin

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Top KingWin has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Pair Trading with Apogee Enterprises and Top KingWin

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

The idea behind Apogee Enterprises and Top KingWin 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.