Correlation Between Calian Technologies and Apple

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

By analyzing existing cross correlation between Calian Technologies and Apple Inc CDR, you can compare the effects of market volatilities on Calian Technologies and Apple 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 Calian Technologies with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calian Technologies and Apple.

Diversification Opportunities for Calian Technologies and Apple

-0.27

Correlation Coefficient

Calian Technologies  Apple

Very good diversification

The 3 months correlation between Calian and Apple is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Calian Technologies and Apple Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc CDR and Calian Technologies 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 Calian Technologies are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc CDR has no effect on the direction of Calian Technologies i.e., Calian Technologies and Apple go up and down completely randomly.

Pair Corralation between Calian Technologies and Apple

Assuming the 90 days trading horizon Calian Technologies is expected to generate 1.23 times more return on investment than Apple. However, Calian Technologies is 1.23 times more volatile than Apple Inc CDR. It trades about 0.05 of its potential returns per unit of risk. Apple Inc CDR is currently generating about -0.05 per unit of risk. If you would invest  4,814  in Calian Technologies on October 12, 2024 and sell it today you would earn a total of  56.00  from holding Calian Technologies or generate 1.16% return on investment over 90 days.

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

Calian Technologies  vs.  Apple Inc CDR

Calian Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Calian Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Calian Technologies is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Apple Inc CDR

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc CDR are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Apple is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Calian Technologies and Apple

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

The idea behind Calian Technologies and Apple Inc CDR 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.