Correlation Between APT Moto and Kroger

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

By analyzing existing cross correlation between APT Moto Vox and Kroger Company, you can compare the effects of market volatilities on APT Moto and Kroger 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 APT Moto with a short position of Kroger. Check out your portfolio center. Please also check ongoing floating volatility patterns of APT Moto and Kroger.

Diversification Opportunities for APT Moto and Kroger

0.0

Correlation Coefficient

APT Moto  Kroger

Pay attention - limited upside

The 3 months correlation between APT and Kroger is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding APT Moto Vox and Kroger Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kroger Company and APT Moto 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 APT Moto Vox are associated (or correlated) with Kroger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kroger Company has no effect on the direction of APT Moto i.e., APT Moto and Kroger go up and down completely randomly.

Pair Corralation between APT Moto and Kroger

If you would invest  5,777  in Kroger Company on October 10, 2024 and sell it today you would earn a total of  137.00  from holding Kroger Company or generate 2.37% return on investment over 90 days.

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

APT Moto Vox  vs.  Kroger Company

APT Moto Vox

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days APT Moto Vox has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, APT Moto is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Kroger Company

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kroger Company are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Kroger may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with APT Moto and Kroger

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

The idea behind APT Moto Vox and Kroger Company 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.