Correlation Between Apple and Boat Rocker
Can any of the company-specific risk be diversified away by investing in both Apple and Boat Rocker 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 Apple and Boat Rocker into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc CDR and Boat Rocker Media, you can compare the effects of market volatilities on Apple and Boat Rocker 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 Apple with a short position of Boat Rocker. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Boat Rocker.
Diversification Opportunities for Apple and Boat Rocker
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Apple and Boat is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc CDR and Boat Rocker Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boat Rocker Media and Apple 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 Apple Inc CDR are associated (or correlated) with Boat Rocker. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boat Rocker Media has no effect on the direction of Apple i.e., Apple and Boat Rocker go up and down completely randomly.
Pair Corralation between Apple and Boat Rocker
Assuming the 90 days trading horizon Apple Inc CDR is expected to generate 0.1 times more return on investment than Boat Rocker. However, Apple Inc CDR is 9.99 times less risky than Boat Rocker. It trades about 0.6 of its potential returns per unit of risk. Boat Rocker Media is currently generating about -0.14 per unit of risk. If you would invest 3,287 in Apple Inc CDR on September 13, 2024 and sell it today you would earn a total of 325.00 from holding Apple Inc CDR or generate 9.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc CDR vs. Boat Rocker Media
Performance |
| Timeline |
| Apple Inc CDR |
| Boat Rocker Media |
Apple and Boat Rocker Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Boat Rocker
The main advantage of trading using opposite Apple and Boat Rocker positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Boat Rocker 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 Boat Rocker will offset losses from the drop in Boat Rocker's long position.| Apple vs. NeXGold Mining Corp | Apple vs. Tree Island Steel | Apple vs. North American Construction | Apple vs. DIRTT Environmental Solutions |
| Boat Rocker vs. Royal Helium | Boat Rocker vs. Excelsior Mining Corp | Boat Rocker vs. Vista Gold | Boat Rocker vs. Intermap Technologies 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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