Correlation Between Apple and Masterflex
Can any of the company-specific risk be diversified away by investing in both Apple and Masterflex 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 Masterflex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Masterflex SE, you can compare the effects of market volatilities on Apple and Masterflex 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 Masterflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Masterflex.
Diversification Opportunities for Apple and Masterflex
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Apple and Masterflex is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Masterflex SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Masterflex SE 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 Masterflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Masterflex SE has no effect on the direction of Apple i.e., Apple and Masterflex go up and down completely randomly.
Pair Corralation between Apple and Masterflex
Assuming the 90 days trading horizon Apple Inc is expected to generate 0.81 times more return on investment than Masterflex. However, Apple Inc is 1.23 times less risky than Masterflex. It trades about 0.16 of its potential returns per unit of risk. Masterflex SE is currently generating about -0.08 per unit of risk. If you would invest 21,604 in Apple Inc on August 29, 2024 and sell it today you would earn a total of 861.00 from holding Apple Inc or generate 3.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Apple Inc vs. Masterflex SE
Performance |
| Timeline |
| Apple Inc |
| Masterflex SE |
Apple and Masterflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Masterflex
The main advantage of trading using opposite Apple and Masterflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Masterflex 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 Masterflex will offset losses from the drop in Masterflex's long position.| Apple vs. Nordic Semiconductor ASA | Apple vs. Altair Engineering | Apple vs. FORWARD AIR P | Apple vs. Westinghouse Air Brake |
| Masterflex vs. FEMALE HEALTH | Masterflex vs. EPSILON HEALTHCARE LTD | Masterflex vs. ATRYS HEALTH SA | Masterflex vs. HEALTHCARE REAL A |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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