Correlation Between Apple and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Apple and Bny Mellon 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 Bny Mellon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Bny Mellon National, you can compare the effects of market volatilities on Apple and Bny Mellon 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 Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Bny Mellon.
Diversification Opportunities for Apple and Bny Mellon
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Apple and Bny is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Bny Mellon National in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon National 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 Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon National has no effect on the direction of Apple i.e., Apple and Bny Mellon go up and down completely randomly.
Pair Corralation between Apple and Bny Mellon
Given the investment horizon of 90 days Apple Inc is expected to under-perform the Bny Mellon. In addition to that, Apple is 10.52 times more volatile than Bny Mellon National. It trades about -0.08 of its total potential returns per unit of risk. Bny Mellon National is currently generating about 0.07 per unit of volatility. If you would invest 1,290 in Bny Mellon National on November 3, 2024 and sell it today you would earn a total of 3.00 from holding Bny Mellon National or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. Bny Mellon National
Performance |
| Timeline |
| Apple Inc |
| Bny Mellon National |
Apple and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Bny Mellon
The main advantage of trading using opposite Apple and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.The idea behind Apple Inc and Bny Mellon National 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.| Bny Mellon vs. Lebenthal Lisanti Small | Bny Mellon vs. Glg Intl Small | Bny Mellon vs. Ab Small Cap | Bny Mellon vs. Smallcap Fund Fka |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |