Correlation Between Apple and SEALED AIR
Can any of the company-specific risk be diversified away by investing in both Apple and SEALED AIR 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 SEALED AIR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and SEALED AIR , you can compare the effects of market volatilities on Apple and SEALED AIR 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 SEALED AIR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and SEALED AIR.
Diversification Opportunities for Apple and SEALED AIR
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apple and SEALED is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and SEALED AIR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEALED AIR 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 SEALED AIR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEALED AIR has no effect on the direction of Apple i.e., Apple and SEALED AIR go up and down completely randomly.
Pair Corralation between Apple and SEALED AIR
Assuming the 90 days trading horizon Apple is expected to generate 1.23 times less return on investment than SEALED AIR. But when comparing it to its historical volatility, Apple Inc is 1.44 times less risky than SEALED AIR. It trades about 0.13 of its potential returns per unit of risk. SEALED AIR is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,320 in SEALED AIR on August 29, 2024 and sell it today you would earn a total of 140.00 from holding SEALED AIR or generate 4.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. SEALED AIR
Performance |
| Timeline |
| Apple Inc |
| SEALED AIR |
Apple and SEALED AIR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and SEALED AIR
The main advantage of trading using opposite Apple and SEALED AIR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, SEALED AIR 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 SEALED AIR will offset losses from the drop in SEALED AIR's long position.| Apple vs. Ryanair Holdings plc | Apple vs. SBA Communications Corp | Apple vs. Consolidated Communications Holdings | Apple vs. Singapore Telecommunications Limited |
| SEALED AIR vs. American Eagle Outfitters | SEALED AIR vs. Safety Insurance Group | SEALED AIR vs. Goosehead Insurance | SEALED AIR vs. JD SPORTS FASH |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Transaction History View history of all your transactions and understand their impact on performance |