Correlation Between OFS Credit and Apollo Global

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Can any of the company-specific risk be diversified away by investing in both OFS Credit and Apollo Global 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 OFS Credit and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OFS Credit Company, and Apollo Global Management, you can compare the effects of market volatilities on OFS Credit and Apollo Global 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 OFS Credit with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of OFS Credit and Apollo Global.

Diversification Opportunities for OFS Credit and Apollo Global

OFSApolloDiversified AwayOFSApolloDiversified Away100%
0.53
  Correlation Coefficient

Very weak diversification

The 3 months correlation between OFS and Apollo is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding OFS Credit Company, and Apollo Global Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Global Management and OFS Credit 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 OFS Credit Company, are associated (or correlated) with Apollo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Global Management has no effect on the direction of OFS Credit i.e., OFS Credit and Apollo Global go up and down completely randomly.

Pair Corralation between OFS Credit and Apollo Global

Assuming the 90 days horizon OFS Credit is expected to generate 11.45 times less return on investment than Apollo Global. But when comparing it to its historical volatility, OFS Credit Company, is 6.48 times less risky than Apollo Global. It trades about 0.06 of its potential returns per unit of risk. Apollo Global Management is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  7,543  in Apollo Global Management on October 12, 2024 and sell it today you would earn a total of  1,003  from holding Apollo Global Management or generate 13.3% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

OFS Credit Company,  vs.  Apollo Global Management

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -10-50510
JavaScript chart by amCharts 3.21.15OCCIM APO-PA
       Timeline  
OFS Credit , 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in OFS Credit Company, are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, OFS Credit is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan24.424.524.624.724.824.925
Apollo Global Management 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Management are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Apollo Global sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan7580859095

OFS Credit and Apollo Global Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-0.99-0.7-0.41-0.120.0044940.160.450.741.031.32 0.51.01.52.02.53.03.5
JavaScript chart by amCharts 3.21.15OCCIM APO-PA
       Returns  

Pair Trading with OFS Credit and Apollo Global

The main advantage of trading using opposite OFS Credit and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OFS Credit position performs unexpectedly, Apollo Global 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 Apollo Global will offset losses from the drop in Apollo Global's long position.
The idea behind OFS Credit Company, and Apollo Global Management 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

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