Correlation Between Apollo Medical and SIMS METAL
Can any of the company-specific risk be diversified away by investing in both Apollo Medical and SIMS METAL 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 Apollo Medical and SIMS METAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Medical Holdings and SIMS METAL MGT, you can compare the effects of market volatilities on Apollo Medical and SIMS METAL 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 Apollo Medical with a short position of SIMS METAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Medical and SIMS METAL.
Diversification Opportunities for Apollo Medical and SIMS METAL
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Apollo and SIMS is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Medical Holdings and SIMS METAL MGT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIMS METAL MGT and Apollo Medical 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 Apollo Medical Holdings are associated (or correlated) with SIMS METAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIMS METAL MGT has no effect on the direction of Apollo Medical i.e., Apollo Medical and SIMS METAL go up and down completely randomly.
Pair Corralation between Apollo Medical and SIMS METAL
Assuming the 90 days horizon Apollo Medical Holdings is expected to generate 0.83 times more return on investment than SIMS METAL. However, Apollo Medical Holdings is 1.2 times less risky than SIMS METAL. It trades about 0.23 of its potential returns per unit of risk. SIMS METAL MGT is currently generating about 0.11 per unit of risk. If you would invest 3,580 in Apollo Medical Holdings on September 2, 2024 and sell it today you would earn a total of 420.00 from holding Apollo Medical Holdings or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Medical Holdings vs. SIMS METAL MGT
Performance |
| Timeline |
| Apollo Medical Holdings |
| SIMS METAL MGT |
Apollo Medical and SIMS METAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Medical and SIMS METAL
The main advantage of trading using opposite Apollo Medical and SIMS METAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Medical position performs unexpectedly, SIMS METAL 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 SIMS METAL will offset losses from the drop in SIMS METAL's long position.| Apollo Medical vs. Apollo Investment Corp | Apollo Medical vs. AVITA Medical | Apollo Medical vs. IMAGIN MEDICAL INC | Apollo Medical vs. MeVis Medical Solutions |
| SIMS METAL vs. GFL ENVIRONM | SIMS METAL vs. Charter Communications | SIMS METAL vs. NIPPON STEEL SPADR | SIMS METAL vs. Entravision Communications |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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