Correlation Between Apollo Investment and PG +
Can any of the company-specific risk be diversified away by investing in both Apollo Investment and PG + 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 PG + 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 PG E P6, you can compare the effects of market volatilities on Apollo Investment and PG + 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 PG +. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and PG +.
Diversification Opportunities for Apollo Investment and PG +
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apollo and PCG6 is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and PG E P6 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PG E P6 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 PG +. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PG E P6 has no effect on the direction of Apollo Investment i.e., Apollo Investment and PG + go up and down completely randomly.
Pair Corralation between Apollo Investment and PG +
Assuming the 90 days trading horizon Apollo Investment Corp is expected to under-perform the PG +. In addition to that, Apollo Investment is 1.04 times more volatile than PG E P6. It trades about -0.1 of its total potential returns per unit of risk. PG E P6 is currently generating about -0.04 per unit of volatility. If you would invest 2,180 in PG E P6 on October 15, 2024 and sell it today you would lose (20.00) from holding PG E P6 or give up 0.92% 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. PG E P6
Performance |
| Timeline |
| Apollo Investment Corp |
| PG E P6 |
Apollo Investment and PG + Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Investment and PG +
The main advantage of trading using opposite Apollo Investment and PG + positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, PG + 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 PG + will offset losses from the drop in PG +'s long position.| Apollo Investment vs. EMBARK EDUCATION LTD | Apollo Investment vs. Applied Materials | Apollo Investment vs. Materialise NV | Apollo Investment vs. Vulcan Materials |
| PG + vs. Geely Automobile Holdings | PG + vs. Cairo Communication SpA | PG + vs. Apollo Investment Corp | PG + vs. Shenandoah Telecommunications |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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