Correlation Between Aldel Financial and Apogee Enterprises
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and Apogee Enterprises 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 Aldel Financial and Apogee Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and Apogee Enterprises, you can compare the effects of market volatilities on Aldel Financial and Apogee Enterprises 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 Aldel Financial with a short position of Apogee Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and Apogee Enterprises.
Diversification Opportunities for Aldel Financial and Apogee Enterprises
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Aldel and Apogee is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and Apogee Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apogee Enterprises and Aldel Financial 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 Aldel Financial II are associated (or correlated) with Apogee Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apogee Enterprises has no effect on the direction of Aldel Financial i.e., Aldel Financial and Apogee Enterprises go up and down completely randomly.
Pair Corralation between Aldel Financial and Apogee Enterprises
Assuming the 90 days horizon Aldel Financial is expected to generate 4699.0 times less return on investment than Apogee Enterprises. But when comparing it to its historical volatility, Aldel Financial II is 18.04 times less risky than Apogee Enterprises. It trades about 0.0 of its potential returns per unit of risk. Apogee Enterprises is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 7,586 in Apogee Enterprises on August 31, 2024 and sell it today you would earn a total of 792.00 from holding Apogee Enterprises or generate 10.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aldel Financial II vs. Apogee Enterprises
Performance |
| Timeline |
| Aldel Financial II |
| Apogee Enterprises |
Aldel Financial and Apogee Enterprises Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and Apogee Enterprises
The main advantage of trading using opposite Aldel Financial and Apogee Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, Apogee Enterprises 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 Apogee Enterprises will offset losses from the drop in Apogee Enterprises' long position.| Aldel Financial vs. RBC Bearings Incorporated | Aldel Financial vs. CECO Environmental Corp | Aldel Financial vs. EMCOR Group | Aldel Financial vs. Simpson Manufacturing |
| Apogee Enterprises vs. Quanex Building Products | Apogee Enterprises vs. Janus International Group | Apogee Enterprises vs. Interface | Apogee Enterprises vs. Azek Company |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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