Correlation Between Apollo Sindoori and FSN E

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

By analyzing existing cross correlation between Apollo Sindoori Hotels and FSN E Commerce Ventures, you can compare the effects of market volatilities on Apollo Sindoori and FSN E 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 Sindoori with a short position of FSN E. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Sindoori and FSN E.

Diversification Opportunities for Apollo Sindoori and FSN E

0.57

Correlation Coefficient

Apollo Sindoori  FSN E

Very weak diversification

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

Pair Corralation between Apollo Sindoori and FSN E

Assuming the 90 days trading horizon Apollo Sindoori Hotels is expected to under-perform the FSN E. But the stock apears to be less risky and, when comparing its historical volatility, Apollo Sindoori Hotels is 1.11 times less risky than FSN E. The stock trades about -0.22 of its potential returns per unit of risk. The FSN E Commerce Ventures is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  16,604  in FSN E Commerce Ventures on October 9, 2024 and sell it today you would earn a total of  548.00  from holding FSN E Commerce Ventures or generate 3.3% return on investment over 90 days.

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

Apollo Sindoori Hotels  vs.  FSN E Commerce Ventures

Apollo Sindoori Hotels

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apollo Sindoori Hotels has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's technical indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

FSN E Commerce

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days FSN E Commerce Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's forward-looking signals remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Apollo Sindoori and FSN E

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

The idea behind Apollo Sindoori Hotels and FSN E Commerce Ventures 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.