Correlation Between Apollo Investment and Global Ship
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and Global Ship 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 Investment and Global Ship into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Investment Corp and Global Ship Lease, you can compare the effects of market volatilities on Apollo Investment and Global Ship 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 Investment with a short position of Global Ship. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and Global Ship.
Diversification Opportunities for Apollo Investment and Global Ship
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Apollo and Global is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and Global Ship Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Ship Lease and Apollo Investment 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 Investment Corp are associated (or correlated) with Global Ship. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Ship Lease has no effect on the direction of Apollo Investment i.e., Apollo Investment and Global Ship go up and down completely randomly.
Pair Corralation between Apollo Investment and Global Ship
Assuming the 90 days trading horizon Apollo Investment Corp is expected to generate 0.71 times more return on investment than Global Ship. However, Apollo Investment Corp is 1.41 times less risky than Global Ship. It trades about 0.19 of its potential returns per unit of risk. Global Ship Lease is currently generating about -0.04 per unit of risk. If you would invest 1,251 in Apollo Investment Corp on August 27, 2024 and sell it today you would earn a total of 67.00 from holding Apollo Investment Corp or generate 5.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Investment Corp vs. Global Ship Lease
Performance |
| Timeline |
| Apollo Investment Corp |
| Global Ship Lease |
Apollo Investment and Global Ship Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and Global Ship
The main advantage of trading using opposite Apollo Investment and Global Ship positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, Global Ship 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 Global Ship will offset losses from the drop in Global Ship's long position.| Apollo Investment vs. Macquarie Group Limited | Apollo Investment vs. MSCI Inc | Apollo Investment vs. Superior Plus Corp | Apollo Investment vs. NMI Holdings |
| Global Ship vs. COSTCO WHOLESALE CDR | Global Ship vs. WisdomTree Investments | Global Ship vs. Apollo Investment Corp | Global Ship vs. Retail Estates NV |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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