Correlation Between Apple and EURASIAN MINERALS
Can any of the company-specific risk be diversified away by investing in both Apple and EURASIAN MINERALS 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 EURASIAN MINERALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and EURASIAN MINERALS, you can compare the effects of market volatilities on Apple and EURASIAN MINERALS 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 EURASIAN MINERALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and EURASIAN MINERALS.
Diversification Opportunities for Apple and EURASIAN MINERALS
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Apple and EURASIAN is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and EURASIAN MINERALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EURASIAN MINERALS 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 EURASIAN MINERALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EURASIAN MINERALS has no effect on the direction of Apple i.e., Apple and EURASIAN MINERALS go up and down completely randomly.
Pair Corralation between Apple and EURASIAN MINERALS
Assuming the 90 days trading horizon Apple Inc is expected to under-perform the EURASIAN MINERALS. In addition to that, Apple is 1.15 times more volatile than EURASIAN MINERALS. It trades about -0.45 of its total potential returns per unit of risk. EURASIAN MINERALS is currently generating about -0.04 per unit of volatility. If you would invest 167.00 in EURASIAN MINERALS on October 29, 2024 and sell it today you would lose (2.00) from holding EURASIAN MINERALS or give up 1.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. EURASIAN MINERALS
Performance |
| Timeline |
| Apple Inc |
| EURASIAN MINERALS |
Apple and EURASIAN MINERALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and EURASIAN MINERALS
The main advantage of trading using opposite Apple and EURASIAN MINERALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, EURASIAN MINERALS 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 EURASIAN MINERALS will offset losses from the drop in EURASIAN MINERALS's long position.| Apple vs. LG Display Co | Apple vs. Mitsubishi Gas Chemical | Apple vs. InPlay Oil Corp | Apple vs. PLAY2CHILL SA ZY |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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