Correlation Between Apollo Food and MClean Technologies
Can any of the company-specific risk be diversified away by investing in both Apollo Food and MClean Technologies 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 Food and MClean Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Food Holdings and MClean Technologies Bhd, you can compare the effects of market volatilities on Apollo Food and MClean Technologies 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 Food with a short position of MClean Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Food and MClean Technologies.
Diversification Opportunities for Apollo Food and MClean Technologies
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Apollo and MClean is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Food Holdings and MClean Technologies Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MClean Technologies Bhd and Apollo Food 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 Food Holdings are associated (or correlated) with MClean Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MClean Technologies Bhd has no effect on the direction of Apollo Food i.e., Apollo Food and MClean Technologies go up and down completely randomly.
Pair Corralation between Apollo Food and MClean Technologies
Assuming the 90 days trading horizon Apollo Food is expected to generate 1.31 times less return on investment than MClean Technologies. But when comparing it to its historical volatility, Apollo Food Holdings is 3.01 times less risky than MClean Technologies. It trades about 0.08 of its potential returns per unit of risk. MClean Technologies Bhd is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 19.00 in MClean Technologies Bhd on August 28, 2024 and sell it today you would earn a total of 4.00 from holding MClean Technologies Bhd or generate 21.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Apollo Food Holdings vs. MClean Technologies Bhd
Performance |
| Timeline |
| Apollo Food Holdings |
| MClean Technologies Bhd |
Apollo Food and MClean Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Food and MClean Technologies
The main advantage of trading using opposite Apollo Food and MClean Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Food position performs unexpectedly, MClean Technologies 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 MClean Technologies will offset losses from the drop in MClean Technologies' long position.| Apollo Food vs. Mercury Industries Bhd | Apollo Food vs. Supercomnet Technologies Bhd | Apollo Food vs. Cosmos Technology International | Apollo Food vs. Diversified Gateway Solutions |
| MClean Technologies vs. Digistar Bhd | MClean Technologies vs. Minetech Resources Bhd | MClean Technologies vs. OpenSys M Bhd | MClean Technologies vs. Insas Bhd |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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