Correlation Between ALEFARM BREWING and Apple
Can any of the company-specific risk be diversified away by investing in both ALEFARM BREWING and Apple 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 ALEFARM BREWING and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALEFARM BREWING DK 05 and Apple Inc, you can compare the effects of market volatilities on ALEFARM BREWING and Apple 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 ALEFARM BREWING with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALEFARM BREWING and Apple.
Diversification Opportunities for ALEFARM BREWING and Apple
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ALEFARM and Apple is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding ALEFARM BREWING DK 05 and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and ALEFARM BREWING 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 ALEFARM BREWING DK 05 are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of ALEFARM BREWING i.e., ALEFARM BREWING and Apple go up and down completely randomly.
Pair Corralation between ALEFARM BREWING and Apple
Assuming the 90 days horizon ALEFARM BREWING DK 05 is expected to generate 2.81 times more return on investment than Apple. However, ALEFARM BREWING is 2.81 times more volatile than Apple Inc. It trades about 0.02 of its potential returns per unit of risk. Apple Inc is currently generating about -0.13 per unit of risk. If you would invest 17.00 in ALEFARM BREWING DK 05 on October 17, 2024 and sell it today you would earn a total of 0.00 from holding ALEFARM BREWING DK 05 or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALEFARM BREWING DK 05 vs. Apple Inc
Performance |
| Timeline |
| ALEFARM BREWING DK |
| Apple Inc |
ALEFARM BREWING and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALEFARM BREWING and Apple
The main advantage of trading using opposite ALEFARM BREWING and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALEFARM BREWING position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| ALEFARM BREWING vs. TOMBADOR IRON LTD | ALEFARM BREWING vs. ARDAGH METAL PACDL 0001 | ALEFARM BREWING vs. United States Steel | ALEFARM BREWING vs. PT Steel Pipe |
| Apple vs. ALEFARM BREWING DK 05 | Apple vs. China Railway Construction | Apple vs. Sumitomo Mitsui Construction | Apple vs. Bio Techne Corp |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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