Correlation Between WOOLWORTHS HLDGS and Apple
Can any of the company-specific risk be diversified away by investing in both WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WOOLWORTHS HLDGS and Apple Inc, you can compare the effects of market volatilities on WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of WOOLWORTHS HLDGS and Apple.
Diversification Opportunities for WOOLWORTHS HLDGS and Apple
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between WOOLWORTHS and Apple is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding WOOLWORTHS HLDGS and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS 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 WOOLWORTHS HLDGS i.e., WOOLWORTHS HLDGS and Apple go up and down completely randomly.
Pair Corralation between WOOLWORTHS HLDGS and Apple
Assuming the 90 days trading horizon WOOLWORTHS HLDGS is expected to under-perform the Apple. In addition to that, WOOLWORTHS HLDGS is 1.83 times more volatile than Apple Inc. It trades about -0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.2 per unit of volatility. If you would invest 21,629 in Apple Inc on September 23, 2024 and sell it today you would earn a total of 2,131 from holding Apple Inc or generate 9.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
WOOLWORTHS HLDGS vs. Apple Inc
Performance |
Timeline |
WOOLWORTHS HLDGS |
Apple Inc |
WOOLWORTHS HLDGS and Apple Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WOOLWORTHS HLDGS and Apple
The main advantage of trading using opposite WOOLWORTHS HLDGS and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WOOLWORTHS HLDGS 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.WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc | WOOLWORTHS HLDGS vs. Apple Inc |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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