Correlation Between Apple and Sporttotal
Can any of the company-specific risk be diversified away by investing in both Apple and Sporttotal 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 Sporttotal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Sporttotal AG, you can compare the effects of market volatilities on Apple and Sporttotal 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 Sporttotal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Sporttotal.
Diversification Opportunities for Apple and Sporttotal
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Apple and Sporttotal is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Sporttotal AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sporttotal AG 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 Sporttotal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sporttotal AG has no effect on the direction of Apple i.e., Apple and Sporttotal go up and down completely randomly.
Pair Corralation between Apple and Sporttotal
Assuming the 90 days trading horizon Apple Inc is expected to under-perform the Sporttotal. But the stock apears to be less risky and, when comparing its historical volatility, Apple Inc is 38.65 times less risky than Sporttotal. The stock trades about -0.3 of its potential returns per unit of risk. The Sporttotal AG is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Sporttotal AG on December 26, 2024 and sell it today you would lose (16.35) from holding Sporttotal AG or give up 77.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. Sporttotal AG
Performance |
| Timeline |
| Apple Inc |
| Sporttotal AG |
Apple and Sporttotal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Sporttotal
The main advantage of trading using opposite Apple and Sporttotal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Sporttotal 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 Sporttotal will offset losses from the drop in Sporttotal's long position.| Apple vs. Strategic Education | Apple vs. American Public Education | Apple vs. Xinhua Winshare Publishing | Apple vs. G8 EDUCATION |
| Sporttotal vs. SmarTone Telecommunications Holdings | Sporttotal vs. Autohome ADR | Sporttotal vs. INTERSHOP Communications Aktiengesellschaft | Sporttotal vs. COMPUTERSHARE |
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.
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