Correlation Between Apogee Enterprises and Sapiens International
Can any of the company-specific risk be diversified away by investing in both Apogee Enterprises and Sapiens International 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 Apogee Enterprises and Sapiens International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apogee Enterprises and Sapiens International, you can compare the effects of market volatilities on Apogee Enterprises and Sapiens International 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 Apogee Enterprises with a short position of Sapiens International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apogee Enterprises and Sapiens International.
Diversification Opportunities for Apogee Enterprises and Sapiens International
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Apogee and Sapiens is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Apogee Enterprises and Sapiens International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sapiens International and Apogee Enterprises 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 Apogee Enterprises are associated (or correlated) with Sapiens International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sapiens International has no effect on the direction of Apogee Enterprises i.e., Apogee Enterprises and Sapiens International go up and down completely randomly.
Pair Corralation between Apogee Enterprises and Sapiens International
Given the investment horizon of 90 days Apogee Enterprises is expected to generate 0.38 times more return on investment than Sapiens International. However, Apogee Enterprises is 2.6 times less risky than Sapiens International. It trades about 0.03 of its potential returns per unit of risk. Sapiens International is currently generating about -0.11 per unit of risk. If you would invest 7,905 in Apogee Enterprises on September 12, 2024 and sell it today you would earn a total of 95.00 from holding Apogee Enterprises or generate 1.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apogee Enterprises vs. Sapiens International
Performance |
| Timeline |
| Apogee Enterprises |
| Sapiens International |
Apogee Enterprises and Sapiens International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apogee Enterprises and Sapiens International
The main advantage of trading using opposite Apogee Enterprises and Sapiens International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apogee Enterprises position performs unexpectedly, Sapiens International 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 Sapiens International will offset losses from the drop in Sapiens International's long position.| Apogee Enterprises vs. Quanex Building Products | Apogee Enterprises vs. Janus International Group | Apogee Enterprises vs. Interface | Apogee Enterprises vs. Azek Company |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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