Correlation Between AES and Apple
Can any of the company-specific risk be diversified away by investing in both AES and Apple 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 AES and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The AES and Apple Inc, you can compare the effects of market volatilities on AES and Apple 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 AES with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of AES and Apple.
Diversification Opportunities for AES and Apple
Excellent diversification
The 3 months correlation between AES and Apple is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding The AES and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and AES 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 The AES are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of AES i.e., AES and Apple go up and down completely randomly.
Pair Corralation between AES and Apple
Assuming the 90 days trading horizon The AES is expected to under-perform the Apple. In addition to that, AES is 1.72 times more volatile than Apple Inc. It trades about -0.03 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.06 per unit of volatility. If you would invest 16,548 in Apple Inc on August 31, 2024 and sell it today you would earn a total of 5,887 from holding Apple Inc or generate 35.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The AES vs. Apple Inc
Performance |
| Timeline |
| AES |
| Apple Inc |
AES and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AES and Apple
The main advantage of trading using opposite AES and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AES position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.| AES vs. SIVERS SEMICONDUCTORS AB | AES vs. Darden Restaurants | AES vs. Reliance Steel Aluminum | AES vs. Q2M Managementberatung AG |
| Apple vs. NTG Nordic Transport | Apple vs. COPLAND ROAD CAPITAL | Apple vs. SBA Communications Corp | Apple vs. T Mobile |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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