Correlation Between Aeon Credit and Apollo Food
Can any of the company-specific risk be diversified away by investing in both Aeon Credit and Apollo Food 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 Aeon Credit and Apollo Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aeon Credit Service and Apollo Food Holdings, you can compare the effects of market volatilities on Aeon Credit and Apollo Food 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 Aeon Credit with a short position of Apollo Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aeon Credit and Apollo Food.
Diversification Opportunities for Aeon Credit and Apollo Food
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aeon and Apollo is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Aeon Credit Service and Apollo Food Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Food Holdings and Aeon Credit 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 Aeon Credit Service are associated (or correlated) with Apollo Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Food Holdings has no effect on the direction of Aeon Credit i.e., Aeon Credit and Apollo Food go up and down completely randomly.
Pair Corralation between Aeon Credit and Apollo Food
Assuming the 90 days trading horizon Aeon Credit Service is expected to under-perform the Apollo Food. In addition to that, Aeon Credit is 1.9 times more volatile than Apollo Food Holdings. It trades about -0.13 of its total potential returns per unit of risk. Apollo Food Holdings is currently generating about -0.19 per unit of volatility. If you would invest 660.00 in Apollo Food Holdings on August 27, 2024 and sell it today you would lose (12.00) from holding Apollo Food Holdings or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aeon Credit Service vs. Apollo Food Holdings
Performance |
| Timeline |
| Aeon Credit Service |
| Apollo Food Holdings |
Aeon Credit and Apollo Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aeon Credit and Apollo Food
The main advantage of trading using opposite Aeon Credit and Apollo Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aeon Credit position performs unexpectedly, Apollo Food 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 Food will offset losses from the drop in Apollo Food's long position.| Aeon Credit vs. Press Metal Bhd | Aeon Credit vs. Malayan Banking Bhd | Aeon Credit vs. Cengild Medical Berhad | Aeon Credit vs. Public Bank Bhd |
| Apollo Food vs. Duopharma Biotech Bhd | Apollo Food vs. Farm Price Holdings | Apollo Food vs. PMB Technology Bhd | Apollo Food vs. Kawan Food Bhd |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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