Correlation Between Apex Frozen and Selan Exploration
Can any of the company-specific risk be diversified away by investing in both Apex Frozen and Selan Exploration 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 Apex Frozen and Selan Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apex Frozen Foods and Selan Exploration Technology, you can compare the effects of market volatilities on Apex Frozen and Selan Exploration 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 Apex Frozen with a short position of Selan Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apex Frozen and Selan Exploration.
Diversification Opportunities for Apex Frozen and Selan Exploration
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Apex and Selan is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Apex Frozen Foods and Selan Exploration Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selan Exploration and Apex Frozen 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 Apex Frozen Foods are associated (or correlated) with Selan Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selan Exploration has no effect on the direction of Apex Frozen i.e., Apex Frozen and Selan Exploration go up and down completely randomly.
Pair Corralation between Apex Frozen and Selan Exploration
Assuming the 90 days trading horizon Apex Frozen Foods is expected to under-perform the Selan Exploration. In addition to that, Apex Frozen is 1.74 times more volatile than Selan Exploration Technology. It trades about -0.12 of its total potential returns per unit of risk. Selan Exploration Technology is currently generating about -0.19 per unit of volatility. If you would invest 89,200 in Selan Exploration Technology on October 18, 2024 and sell it today you would lose (8,920) from holding Selan Exploration Technology or give up 10.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apex Frozen Foods vs. Selan Exploration Technology
Performance |
| Timeline |
| Apex Frozen Foods |
| Selan Exploration |
Apex Frozen and Selan Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apex Frozen and Selan Exploration
The main advantage of trading using opposite Apex Frozen and Selan Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apex Frozen position performs unexpectedly, Selan Exploration 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 Selan Exploration will offset losses from the drop in Selan Exploration's long position.| Apex Frozen vs. Asian Hotels Limited | Apex Frozen vs. SINCLAIRS HOTELS ORD | Apex Frozen vs. DIAMINES AND CHEMICALS | Apex Frozen vs. JGCHEMICALS LIMITED |
| Selan Exploration vs. The Indian Hotels | Selan Exploration vs. Blue Coast Hotels | Selan Exploration vs. Apex Frozen Foods | Selan Exploration vs. Patanjali Foods Limited |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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