Correlation Between AP Moeller and AP Moeller
Can any of the company-specific risk be diversified away by investing in both AP Moeller and AP Moeller 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 AP Moeller and AP Moeller into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AP Moeller and AP Moeller Maersk AS, you can compare the effects of market volatilities on AP Moeller and AP Moeller 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 AP Moeller with a short position of AP Moeller. Check out your portfolio center. Please also check ongoing floating volatility patterns of AP Moeller and AP Moeller.
Diversification Opportunities for AP Moeller and AP Moeller
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between 0O77 and 0O76 is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding AP Moeller and AP Moeller Maersk AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AP Moeller Maersk and AP Moeller 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 AP Moeller are associated (or correlated) with AP Moeller. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AP Moeller Maersk has no effect on the direction of AP Moeller i.e., AP Moeller and AP Moeller go up and down completely randomly.
Pair Corralation between AP Moeller and AP Moeller
Assuming the 90 days trading horizon AP Moeller is expected to generate 1.06 times more return on investment than AP Moeller. However, AP Moeller is 1.06 times more volatile than AP Moeller Maersk AS. It trades about 0.53 of its potential returns per unit of risk. AP Moeller Maersk AS is currently generating about 0.51 per unit of risk. If you would invest 1,025,500 in AP Moeller on November 28, 2024 and sell it today you would earn a total of 280,000 from holding AP Moeller or generate 27.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
AP Moeller vs. AP Moeller Maersk AS
Performance |
| Timeline |
| AP Moeller |
| AP Moeller Maersk |
AP Moeller and AP Moeller Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AP Moeller and AP Moeller
The main advantage of trading using opposite AP Moeller and AP Moeller positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AP Moeller position performs unexpectedly, AP Moeller 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 AP Moeller will offset losses from the drop in AP Moeller's long position.| AP Moeller vs. Vitec Software Group | AP Moeller vs. Logitech International SA | AP Moeller vs. Micron Technology | AP Moeller vs. Check Point Software |
| AP Moeller vs. Lowland Investment Co | AP Moeller vs. Scandinavian Tobacco Group | AP Moeller vs. MTI Wireless Edge | AP Moeller vs. Global Net Lease |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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