Correlation Between USWE SPORTS and Apollo Investment
Can any of the company-specific risk be diversified away by investing in both USWE SPORTS and Apollo Investment 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 USWE SPORTS and Apollo Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between USWE SPORTS AB and Apollo Investment Corp, you can compare the effects of market volatilities on USWE SPORTS and Apollo Investment 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 USWE SPORTS with a short position of Apollo Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of USWE SPORTS and Apollo Investment.
Diversification Opportunities for USWE SPORTS and Apollo Investment
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between USWE and Apollo is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding USWE SPORTS AB and Apollo Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Investment Corp and USWE SPORTS 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 USWE SPORTS AB are associated (or correlated) with Apollo Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Investment Corp has no effect on the direction of USWE SPORTS i.e., USWE SPORTS and Apollo Investment go up and down completely randomly.
Pair Corralation between USWE SPORTS and Apollo Investment
Assuming the 90 days horizon USWE SPORTS is expected to generate 1.49 times less return on investment than Apollo Investment. In addition to that, USWE SPORTS is 1.71 times more volatile than Apollo Investment Corp. It trades about 0.14 of its total potential returns per unit of risk. Apollo Investment Corp is currently generating about 0.35 per unit of volatility. If you would invest 1,218 in Apollo Investment Corp on September 3, 2024 and sell it today you would earn a total of 108.00 from holding Apollo Investment Corp or generate 8.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
USWE SPORTS AB vs. Apollo Investment Corp
Performance |
| Timeline |
| USWE SPORTS AB |
| Apollo Investment Corp |
USWE SPORTS and Apollo Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with USWE SPORTS and Apollo Investment
The main advantage of trading using opposite USWE SPORTS and Apollo Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if USWE SPORTS position performs unexpectedly, Apollo Investment 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 Apollo Investment will offset losses from the drop in Apollo Investment's long position.| USWE SPORTS vs. Li Ning Company | USWE SPORTS vs. SHIMANO INC UNSPADR10 | USWE SPORTS vs. Superior Plus Corp | USWE SPORTS vs. NMI Holdings |
| Apollo Investment vs. Morgan Stanley | Apollo Investment vs. The Goldman Sachs | Apollo Investment vs. The Goldman Sachs | Apollo Investment vs. Superior Plus 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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