Correlation Between Figaro Coffee and Apollo Global
Can any of the company-specific risk be diversified away by investing in both Figaro Coffee and Apollo Global 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 Figaro Coffee and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Figaro Coffee Group and Apollo Global Capital, you can compare the effects of market volatilities on Figaro Coffee and Apollo Global 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 Figaro Coffee with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Figaro Coffee and Apollo Global.
Diversification Opportunities for Figaro Coffee and Apollo Global
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Figaro and Apollo is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Figaro Coffee Group and Apollo Global Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Global Capital and Figaro Coffee 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 Figaro Coffee Group are associated (or correlated) with Apollo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Global Capital has no effect on the direction of Figaro Coffee i.e., Figaro Coffee and Apollo Global go up and down completely randomly.
Pair Corralation between Figaro Coffee and Apollo Global
Assuming the 90 days trading horizon Figaro Coffee Group is expected to generate 0.8 times more return on investment than Apollo Global. However, Figaro Coffee Group is 1.25 times less risky than Apollo Global. It trades about -0.08 of its potential returns per unit of risk. Apollo Global Capital is currently generating about -0.27 per unit of risk. If you would invest 88.00 in Figaro Coffee Group on August 29, 2024 and sell it today you would lose (4.00) from holding Figaro Coffee Group or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Figaro Coffee Group vs. Apollo Global Capital
Performance |
| Timeline |
| Figaro Coffee Group |
| Apollo Global Capital |
Figaro Coffee and Apollo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Figaro Coffee and Apollo Global
The main advantage of trading using opposite Figaro Coffee and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Figaro Coffee position performs unexpectedly, Apollo Global 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 Apollo Global will offset losses from the drop in Apollo Global's long position.| Figaro Coffee vs. Semirara Mining Corp | Figaro Coffee vs. Converge Information Communications | Figaro Coffee vs. Apex Mining Co | Figaro Coffee vs. Metro Retail Stores |
| Apollo Global vs. Converge Information Communications | Apollo Global vs. Figaro Coffee Group | Apollo Global vs. Jollibee Foods Corp | Apollo Global vs. Rizal Commercial Banking |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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