Correlation Between DFS Furniture and Apple
Can any of the company-specific risk be diversified away by investing in both DFS Furniture and Apple 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 DFS Furniture and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DFS Furniture PLC and Apple Inc, you can compare the effects of market volatilities on DFS Furniture and Apple 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 DFS Furniture with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of DFS Furniture and Apple.
Diversification Opportunities for DFS Furniture and Apple
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DFS and Apple is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding DFS Furniture PLC and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and DFS Furniture 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 DFS Furniture PLC are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of DFS Furniture i.e., DFS Furniture and Apple go up and down completely randomly.
Pair Corralation between DFS Furniture and Apple
Assuming the 90 days trading horizon DFS Furniture PLC is expected to under-perform the Apple. In addition to that, DFS Furniture is 2.53 times more volatile than Apple Inc. It trades about -0.13 of its total potential returns per unit of risk. Apple Inc is currently generating about -0.08 per unit of volatility. If you would invest 23,615 in Apple Inc on October 14, 2024 and sell it today you would lose (430.00) from holding Apple Inc or give up 1.82% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
DFS Furniture PLC vs. Apple Inc
Performance |
Timeline |
DFS Furniture PLC |
Apple Inc |
DFS Furniture and Apple Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with DFS Furniture and Apple
The main advantage of trading using opposite DFS Furniture and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DFS Furniture position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple's long position.DFS Furniture vs. OFFICE DEPOT | DFS Furniture vs. ORMAT TECHNOLOGIES | DFS Furniture vs. ACCSYS TECHPLC EO | DFS Furniture vs. alstria office REIT AG |
Apple vs. DFS Furniture PLC | Apple vs. Calibre Mining Corp | Apple vs. Haier Smart Home | Apple vs. Mitsui Chemicals |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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