Correlation Between Apple and Vitrolife
Can any of the company-specific risk be diversified away by investing in both Apple and Vitrolife 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 Vitrolife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Vitrolife AB, you can compare the effects of market volatilities on Apple and Vitrolife 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 Vitrolife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Vitrolife.
Diversification Opportunities for Apple and Vitrolife
Very good diversification
The 3 months correlation between Apple and Vitrolife is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Vitrolife AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vitrolife AB 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 Vitrolife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vitrolife AB has no effect on the direction of Apple i.e., Apple and Vitrolife go up and down completely randomly.
Pair Corralation between Apple and Vitrolife
Given the investment horizon of 90 days Apple Inc is expected to under-perform the Vitrolife. But the stock apears to be less risky and, when comparing its historical volatility, Apple Inc is 1.36 times less risky than Vitrolife. The stock trades about -0.39 of its potential returns per unit of risk. The Vitrolife AB is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 21,560 in Vitrolife AB on October 24, 2024 and sell it today you would lose (760.00) from holding Vitrolife AB or give up 3.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 88.89% |
| Values | Daily Returns |
Apple Inc vs. Vitrolife AB
Performance |
| Timeline |
| Apple Inc |
| Vitrolife AB |
Apple and Vitrolife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Vitrolife
The main advantage of trading using opposite Apple and Vitrolife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Vitrolife 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 Vitrolife will offset losses from the drop in Vitrolife's long position.The idea behind Apple Inc and Vitrolife AB 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.| Vitrolife vs. AcadeMedia AB | Vitrolife vs. USWE Sports AB | Vitrolife vs. JLT Mobile Computers | Vitrolife vs. Viaplay Group AB |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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