Correlation Between Apple and NORDIC HALIBUT
Can any of the company-specific risk be diversified away by investing in both Apple and NORDIC HALIBUT 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 NORDIC HALIBUT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and NORDIC HALIBUT AS, you can compare the effects of market volatilities on Apple and NORDIC HALIBUT 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 NORDIC HALIBUT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and NORDIC HALIBUT.
Diversification Opportunities for Apple and NORDIC HALIBUT
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Apple and NORDIC is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and NORDIC HALIBUT AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORDIC HALIBUT AS 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 NORDIC HALIBUT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORDIC HALIBUT AS has no effect on the direction of Apple i.e., Apple and NORDIC HALIBUT go up and down completely randomly.
Pair Corralation between Apple and NORDIC HALIBUT
Assuming the 90 days trading horizon Apple Inc is expected to generate 0.63 times more return on investment than NORDIC HALIBUT. However, Apple Inc is 1.6 times less risky than NORDIC HALIBUT. It trades about 0.11 of its potential returns per unit of risk. NORDIC HALIBUT AS is currently generating about -0.02 per unit of risk. If you would invest 17,703 in Apple Inc on November 28, 2024 and sell it today you would earn a total of 5,822 from holding Apple Inc or generate 32.89% 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. NORDIC HALIBUT AS
Performance |
| Timeline |
| Apple Inc |
| NORDIC HALIBUT AS |
Apple and NORDIC HALIBUT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and NORDIC HALIBUT
The main advantage of trading using opposite Apple and NORDIC HALIBUT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, NORDIC HALIBUT 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 NORDIC HALIBUT will offset losses from the drop in NORDIC HALIBUT's long position.| Apple vs. Transport International Holdings | Apple vs. SOGECLAIR SA INH | Apple vs. Altair Engineering | Apple vs. Transportadora de Gas |
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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