Correlation Between Apple and Cassiar Gold
Can any of the company-specific risk be diversified away by investing in both Apple and Cassiar Gold 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 Cassiar Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Cassiar Gold Corp, you can compare the effects of market volatilities on Apple and Cassiar Gold 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 Cassiar Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Cassiar Gold.
Diversification Opportunities for Apple and Cassiar Gold
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Apple and Cassiar is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Cassiar Gold Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cassiar Gold Corp 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 are associated (or correlated) with Cassiar Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cassiar Gold Corp has no effect on the direction of Apple i.e., Apple and Cassiar Gold go up and down completely randomly.
Pair Corralation between Apple and Cassiar Gold
Given the investment horizon of 90 days Apple Inc is expected to under-perform the Cassiar Gold. But the stock apears to be less risky and, when comparing its historical volatility, Apple Inc is 1.88 times less risky than Cassiar Gold. The stock trades about -0.07 of its potential returns per unit of risk. The Cassiar Gold Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 20.00 in Cassiar Gold Corp on November 4, 2024 and sell it today you would earn a total of 1.00 from holding Cassiar Gold Corp or generate 5.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
Apple Inc vs. Cassiar Gold Corp
Performance |
| Timeline |
| Apple Inc |
| Cassiar Gold Corp |
Apple and Cassiar Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Cassiar Gold
The main advantage of trading using opposite Apple and Cassiar Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Cassiar Gold 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 Cassiar Gold will offset losses from the drop in Cassiar Gold's long position.The idea behind Apple Inc and Cassiar Gold Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Cassiar Gold vs. Constellation Software | Cassiar Gold vs. Computer Modelling Group | Cassiar Gold vs. Calian Technologies | Cassiar Gold vs. Northstar Clean Technologies |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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