Correlation Between Apple and JAPFA COMFEED
Can any of the company-specific risk be diversified away by investing in both Apple and JAPFA COMFEED 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 JAPFA COMFEED into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and JAPFA FEED A , you can compare the effects of market volatilities on Apple and JAPFA COMFEED 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 JAPFA COMFEED. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and JAPFA COMFEED.
Diversification Opportunities for Apple and JAPFA COMFEED
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apple and JAPFA is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and JAPFA FEED A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JAPFA COMFEED 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 JAPFA COMFEED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JAPFA COMFEED has no effect on the direction of Apple i.e., Apple and JAPFA COMFEED go up and down completely randomly.
Pair Corralation between Apple and JAPFA COMFEED
Assuming the 90 days trading horizon Apple is expected to generate 29.49 times less return on investment than JAPFA COMFEED. But when comparing it to its historical volatility, Apple Inc is 1.89 times less risky than JAPFA COMFEED. It trades about 0.01 of its potential returns per unit of risk. JAPFA FEED A is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 9.50 in JAPFA FEED A on October 24, 2024 and sell it today you would earn a total of 1.50 from holding JAPFA FEED A or generate 15.79% 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. JAPFA FEED A
Performance |
| Timeline |
| Apple Inc |
| JAPFA COMFEED |
Apple and JAPFA COMFEED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and JAPFA COMFEED
The main advantage of trading using opposite Apple and JAPFA COMFEED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, JAPFA COMFEED 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 JAPFA COMFEED will offset losses from the drop in JAPFA COMFEED's long position.| Apple vs. Air Transport Services | Apple vs. Yuexiu Transport Infrastructure | Apple vs. DISTRICT METALS | Apple vs. Zijin Mining Group |
| JAPFA COMFEED vs. Apple Inc | JAPFA COMFEED vs. Apple Inc | JAPFA COMFEED vs. Apple Inc | JAPFA COMFEED vs. Apple Inc |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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