Correlation Between Apollo Investment and Berkshire Hills
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and Berkshire Hills 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 Berkshire Hills 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 Berkshire Hills Bancorp, you can compare the effects of market volatilities on Apollo Investment and Berkshire Hills 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 Berkshire Hills. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and Berkshire Hills.
Diversification Opportunities for Apollo Investment and Berkshire Hills
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Apollo and Berkshire is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and Berkshire Hills Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Berkshire Hills Bancorp 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 Berkshire Hills. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Berkshire Hills Bancorp has no effect on the direction of Apollo Investment i.e., Apollo Investment and Berkshire Hills go up and down completely randomly.
Pair Corralation between Apollo Investment and Berkshire Hills
Assuming the 90 days trading horizon Apollo Investment is expected to generate 1.74 times less return on investment than Berkshire Hills. But when comparing it to its historical volatility, Apollo Investment Corp is 5.24 times less risky than Berkshire Hills. It trades about 0.18 of its potential returns per unit of risk. Berkshire Hills Bancorp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 2,760 in Berkshire Hills Bancorp on September 15, 2024 and sell it today you would earn a total of 100.00 from holding Berkshire Hills Bancorp or generate 3.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Investment Corp vs. Berkshire Hills Bancorp
Performance |
| Timeline |
| Apollo Investment Corp |
| Berkshire Hills Bancorp |
Apollo Investment and Berkshire Hills Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and Berkshire Hills
The main advantage of trading using opposite Apollo Investment and Berkshire Hills positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, Berkshire Hills 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 Berkshire Hills will offset losses from the drop in Berkshire Hills' long position.| Apollo Investment vs. Shenandoah Telecommunications | Apollo Investment vs. DICKS Sporting Goods | Apollo Investment vs. Charter Communications | Apollo Investment vs. Fukuyama Transporting Co |
| Berkshire Hills vs. PennantPark Investment | Berkshire Hills vs. NXP Semiconductors NV | Berkshire Hills vs. Apollo Investment Corp | Berkshire Hills vs. VIRGIN WINES UK |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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