Correlation Between Walmart and Apollo Strategic

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

By analyzing existing cross correlation between Walmart and Apollo Strategic Growth, you can compare the effects of market volatilities on Walmart and Apollo Strategic 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 Walmart with a short position of Apollo Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Apollo Strategic.

Diversification Opportunities for Walmart and Apollo Strategic

0.8

Correlation Coefficient

Walmart  Apollo Strategic

Very poor diversification

The 3 months correlation between Walmart and Apollo is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Apollo Strategic Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Strategic Growth and Walmart 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 Walmart are associated (or correlated) with Apollo Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Strategic Growth has no effect on the direction of Walmart i.e., Walmart and Apollo Strategic go up and down completely randomly.

Pair Corralation between Walmart and Apollo Strategic

If you would invest  5,260  in Walmart on September 28, 2024 and sell it today you would earn a total of  3,897  from holding Walmart or generate 74.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	0.3%
Values	Daily Returns

Walmart  vs.  Apollo Strategic Growth

Walmart

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain primary indicators, Walmart unveiled solid returns over the last few months and may actually be approaching a breakup point.

Apollo Strategic Growth

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apollo Strategic Growth has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Apollo Strategic is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Walmart and Apollo Strategic

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

The idea behind Walmart and Apollo Strategic Growth 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.

Check out your portfolio center.

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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.