Correlation Between Apple and Fuji Media
Can any of the company-specific risk be diversified away by investing in both Apple and Fuji Media 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 Fuji Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Fuji Media Holdings, you can compare the effects of market volatilities on Apple and Fuji Media 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 Fuji Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Fuji Media.
Diversification Opportunities for Apple and Fuji Media
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Apple and Fuji is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Fuji Media Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuji Media Holdings 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 Fuji Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuji Media Holdings has no effect on the direction of Apple i.e., Apple and Fuji Media go up and down completely randomly.
Pair Corralation between Apple and Fuji Media
Assuming the 90 days trading horizon Apple Inc is expected to under-perform the Fuji Media. But the stock apears to be less risky and, when comparing its historical volatility, Apple Inc is 1.87 times less risky than Fuji Media. The stock trades about -0.49 of its potential returns per unit of risk. The Fuji Media Holdings is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,050 in Fuji Media Holdings on October 25, 2024 and sell it today you would earn a total of 140.00 from holding Fuji Media Holdings or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. Fuji Media Holdings
Performance |
| Timeline |
| Apple Inc |
| Fuji Media Holdings |
Apple and Fuji Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Fuji Media
The main advantage of trading using opposite Apple and Fuji Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Fuji Media 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 Fuji Media will offset losses from the drop in Fuji Media's long position.| Apple vs. PEPTONIC MEDICAL | Apple vs. SMA Solar Technology | Apple vs. AECOM TECHNOLOGY | Apple vs. Medical Properties Trust |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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