Correlation Between Apollo Medical and Industria
Can any of the company-specific risk be diversified away by investing in both Apollo Medical and Industria 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 Industria 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 Industria de Diseno, you can compare the effects of market volatilities on Apollo Medical and Industria 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 Industria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Medical and Industria.
Diversification Opportunities for Apollo Medical and Industria
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apollo and Industria is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Medical Holdings and Industria de Diseno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industria de Diseno 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 Industria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industria de Diseno has no effect on the direction of Apollo Medical i.e., Apollo Medical and Industria go up and down completely randomly.
Pair Corralation between Apollo Medical and Industria
Assuming the 90 days horizon Apollo Medical Holdings is expected to generate 1.92 times more return on investment than Industria. However, Apollo Medical is 1.92 times more volatile than Industria de Diseno. It trades about 0.22 of its potential returns per unit of risk. Industria de Diseno is currently generating about 0.18 per unit of risk. If you would invest 3,020 in Apollo Medical Holdings on November 3, 2024 and sell it today you would earn a total of 460.00 from holding Apollo Medical Holdings or generate 15.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Medical Holdings vs. Industria de Diseno
Performance |
| Timeline |
| Apollo Medical Holdings |
| Industria de Diseno |
Apollo Medical and Industria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Medical and Industria
The main advantage of trading using opposite Apollo Medical and Industria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Medical position performs unexpectedly, Industria 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 Industria will offset losses from the drop in Industria's long position.| Apollo Medical vs. X FAB Silicon Foundries | Apollo Medical vs. Soken Chemical Engineering | Apollo Medical vs. INDO RAMA SYNTHETIC | Apollo Medical vs. TRI CHEMICAL LABORATINC |
| Industria vs. The TJX Companies | Industria vs. Fast Retailing Co | Industria vs. Lululemon Athletica | Industria vs. NEXT plc |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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