Correlation Between Apollo Food and SFP Tech
Can any of the company-specific risk be diversified away by investing in both Apollo Food and SFP Tech 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 SFP Tech 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 SFP Tech Holdings, you can compare the effects of market volatilities on Apollo Food and SFP Tech 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 SFP Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Food and SFP Tech.
Diversification Opportunities for Apollo Food and SFP Tech
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Apollo and SFP is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Food Holdings and SFP Tech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFP Tech Holdings 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 SFP Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFP Tech Holdings has no effect on the direction of Apollo Food i.e., Apollo Food and SFP Tech go up and down completely randomly.
Pair Corralation between Apollo Food and SFP Tech
Assuming the 90 days trading horizon Apollo Food Holdings is expected to generate 0.78 times more return on investment than SFP Tech. However, Apollo Food Holdings is 1.28 times less risky than SFP Tech. It trades about 0.08 of its potential returns per unit of risk. SFP Tech Holdings is currently generating about -0.01 per unit of risk. If you would invest 361.00 in Apollo Food Holdings on August 31, 2024 and sell it today you would earn a total of 278.00 from holding Apollo Food Holdings or generate 77.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.48% |
| Values | Daily Returns |
Apollo Food Holdings vs. SFP Tech Holdings
Performance |
| Timeline |
| Apollo Food Holdings |
| SFP Tech Holdings |
Apollo Food and SFP Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Food and SFP Tech
The main advantage of trading using opposite Apollo Food and SFP Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Food position performs unexpectedly, SFP Tech 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 SFP Tech will offset losses from the drop in SFP Tech's long position.| Apollo Food vs. Senheng New Retail | Apollo Food vs. Cengild Medical Berhad | Apollo Food vs. Press Metal Bhd | Apollo Food vs. TAS Offshore Bhd |
| SFP Tech vs. Scientex Packaging | SFP Tech vs. UNIQUE | SFP Tech vs. Dnonce Tech Bhd | SFP Tech vs. Protasco 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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