Correlation Between Apollo Investment and CAREER EDUCATION
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and CAREER EDUCATION 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 CAREER EDUCATION 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 CAREER EDUCATION, you can compare the effects of market volatilities on Apollo Investment and CAREER EDUCATION 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 CAREER EDUCATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and CAREER EDUCATION.
Diversification Opportunities for Apollo Investment and CAREER EDUCATION
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Apollo and CAREER is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and CAREER EDUCATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CAREER EDUCATION 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 CAREER EDUCATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CAREER EDUCATION has no effect on the direction of Apollo Investment i.e., Apollo Investment and CAREER EDUCATION go up and down completely randomly.
Pair Corralation between Apollo Investment and CAREER EDUCATION
Assuming the 90 days trading horizon Apollo Investment is expected to generate 2.73 times less return on investment than CAREER EDUCATION. But when comparing it to its historical volatility, Apollo Investment Corp is 3.23 times less risky than CAREER EDUCATION. It trades about 0.36 of its potential returns per unit of risk. CAREER EDUCATION is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 2,040 in CAREER EDUCATION on September 1, 2024 and sell it today you would earn a total of 560.00 from holding CAREER EDUCATION or generate 27.45% 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. CAREER EDUCATION
Performance |
| Timeline |
| Apollo Investment Corp |
| CAREER EDUCATION |
Apollo Investment and CAREER EDUCATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and CAREER EDUCATION
The main advantage of trading using opposite Apollo Investment and CAREER EDUCATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, CAREER EDUCATION 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 CAREER EDUCATION will offset losses from the drop in CAREER EDUCATION's long position.| Apollo Investment vs. USWE SPORTS AB | Apollo Investment vs. PARKEN Sport Entertainment | Apollo Investment vs. SPORTING | Apollo Investment vs. Transport International Holdings |
| CAREER EDUCATION vs. SIVERS SEMICONDUCTORS AB | CAREER EDUCATION vs. Darden Restaurants | CAREER EDUCATION vs. Reliance Steel Aluminum | CAREER EDUCATION vs. Q2M Managementberatung AG |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |