Correlation Between Apollo Investment and FIRST SAVINGS
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and FIRST SAVINGS 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 FIRST SAVINGS 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 FIRST SAVINGS FINL, you can compare the effects of market volatilities on Apollo Investment and FIRST SAVINGS 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 FIRST SAVINGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and FIRST SAVINGS.
Diversification Opportunities for Apollo Investment and FIRST SAVINGS
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apollo and FIRST is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and FIRST SAVINGS FINL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIRST SAVINGS FINL 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 FIRST SAVINGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIRST SAVINGS FINL has no effect on the direction of Apollo Investment i.e., Apollo Investment and FIRST SAVINGS go up and down completely randomly.
Pair Corralation between Apollo Investment and FIRST SAVINGS
Assuming the 90 days trading horizon Apollo Investment Corp is expected to generate 0.42 times more return on investment than FIRST SAVINGS. However, Apollo Investment Corp is 2.4 times less risky than FIRST SAVINGS. It trades about -0.1 of its potential returns per unit of risk. FIRST SAVINGS FINL is currently generating about -0.18 per unit of risk. If you would invest 1,292 in Apollo Investment Corp on October 12, 2024 and sell it today you would lose (28.00) from holding Apollo Investment Corp or give up 2.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Investment Corp vs. FIRST SAVINGS FINL
Performance |
| Timeline |
| Apollo Investment Corp |
| FIRST SAVINGS FINL |
Apollo Investment and FIRST SAVINGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and FIRST SAVINGS
The main advantage of trading using opposite Apollo Investment and FIRST SAVINGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, FIRST SAVINGS 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 FIRST SAVINGS will offset losses from the drop in FIRST SAVINGS's long position.| Apollo Investment vs. X FAB Silicon Foundries | Apollo Investment vs. AIR PRODCHEMICALS | Apollo Investment vs. SILICON LABORATOR | Apollo Investment vs. China BlueChemical |
| FIRST SAVINGS vs. CITY OFFICE REIT | FIRST SAVINGS vs. Aedas Homes SA | FIRST SAVINGS vs. Diamyd Medical AB | FIRST SAVINGS vs. Neinor Homes SA |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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