Correlation Between Apollo Global and Legal General
Can any of the company-specific risk be diversified away by investing in both Apollo Global and Legal General 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 Apollo Global and Legal General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apollo Global Management and Legal General Group, you can compare the effects of market volatilities on Apollo Global and Legal General 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 Apollo Global with a short position of Legal General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Global and Legal General.
Diversification Opportunities for Apollo Global and Legal General
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Apollo and Legal is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Management and Legal General Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Legal General Group and Apollo Global 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 Apollo Global Management are associated (or correlated) with Legal General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Legal General Group has no effect on the direction of Apollo Global i.e., Apollo Global and Legal General go up and down completely randomly.
Pair Corralation between Apollo Global and Legal General
Considering the 90-day investment horizon Apollo Global Management is expected to generate 1.62 times more return on investment than Legal General. However, Apollo Global is 1.62 times more volatile than Legal General Group. It trades about 0.14 of its potential returns per unit of risk. Legal General Group is currently generating about -0.02 per unit of risk. If you would invest 9,892 in Apollo Global Management on August 28, 2024 and sell it today you would earn a total of 7,578 from holding Apollo Global Management or generate 76.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apollo Global Management vs. Legal General Group
Performance |
| Timeline |
| Apollo Global Management |
| Legal General Group |
Apollo Global and Legal General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apollo Global and Legal General
The main advantage of trading using opposite Apollo Global and Legal General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Global position performs unexpectedly, Legal General 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 Legal General will offset losses from the drop in Legal General's long position.| Apollo Global vs. PowerUp Acquisition Corp | Apollo Global vs. Aurora Innovation | Apollo Global vs. HUMANA INC | Apollo Global vs. Aquagold International |
| Legal General vs. Inflection Point Acquisition | Legal General vs. Aldel Financial II | Legal General vs. Eldorado Gold Corp | Legal General vs. CapitaLand Investment 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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