Correlation Between Apollo Investment and CryoLife
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and CryoLife 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 CryoLife 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 CryoLife, you can compare the effects of market volatilities on Apollo Investment and CryoLife 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 CryoLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and CryoLife.
Diversification Opportunities for Apollo Investment and CryoLife
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apollo and CryoLife is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and CryoLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CryoLife 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 CryoLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CryoLife has no effect on the direction of Apollo Investment i.e., Apollo Investment and CryoLife go up and down completely randomly.
Pair Corralation between Apollo Investment and CryoLife
Assuming the 90 days trading horizon Apollo Investment is expected to generate 1.54 times less return on investment than CryoLife. But when comparing it to its historical volatility, Apollo Investment Corp is 1.49 times less risky than CryoLife. It trades about 0.26 of its potential returns per unit of risk. CryoLife is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 2,435 in CryoLife on August 30, 2024 and sell it today you would earn a total of 285.00 from holding CryoLife or generate 11.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Investment Corp vs. CryoLife
Performance |
| Timeline |
| Apollo Investment Corp |
| CryoLife |
Apollo Investment and CryoLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and CryoLife
The main advantage of trading using opposite Apollo Investment and CryoLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, CryoLife 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 CryoLife will offset losses from the drop in CryoLife's long position.| Apollo Investment vs. Flowers Foods | Apollo Investment vs. PREMIER FOODS | Apollo Investment vs. Ultra Clean Holdings | Apollo Investment vs. SENECA FOODS A |
| CryoLife vs. Playtech plc | CryoLife vs. INTERSHOP Communications Aktiengesellschaft | CryoLife vs. ORMAT TECHNOLOGIES | CryoLife vs. Singapore Telecommunications Limited |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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