Correlation Between Data Modul and Apple

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

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

Diversification Opportunities for Data Modul and Apple

0.37

Correlation Coefficient

Data Modul  Apple

Weak diversification

The 3 months correlation between Data and Apple is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Data Modul AG and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Data Modul 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 Data Modul AG 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 has no effect on the direction of Data Modul i.e., Data Modul and Apple go up and down completely randomly.

Pair Corralation between Data Modul and Apple

Assuming the 90 days trading horizon Data Modul AG is expected to generate 1.37 times more return on investment than Apple. However, Data Modul is 1.37 times more volatile than Apple Inc. It trades about 0.0 of its potential returns per unit of risk. Apple Inc is currently generating about -0.19 per unit of risk. If you would invest  2,700  in Data Modul AG on December 21, 2024 and sell it today you would lose (60.00) from holding Data Modul AG or give up 2.22% of portfolio value over 90 days.

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

Data Modul AG  vs.  Apple Inc

Data Modul AG

Risk-Adjusted Performance

Very Weak

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

Apple Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's fundamental indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Data Modul and Apple

The main advantage of trading using opposite Data Modul and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Data Modul 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 Data Modul AG and Apple Inc 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..