Correlation Between PTT Global and Apollo Investment
Can any of the company-specific risk be diversified away by investing in both PTT Global and Apollo Investment 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 PTT Global and Apollo Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PTT Global Chemical and Apollo Investment Corp, you can compare the effects of market volatilities on PTT Global and Apollo Investment 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 PTT Global with a short position of Apollo Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of PTT Global and Apollo Investment.
Diversification Opportunities for PTT Global and Apollo Investment
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PTT and Apollo is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding PTT Global Chemical and Apollo Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Investment Corp and PTT 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 PTT Global Chemical are associated (or correlated) with Apollo Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Investment Corp has no effect on the direction of PTT Global i.e., PTT Global and Apollo Investment go up and down completely randomly.
Pair Corralation between PTT Global and Apollo Investment
Assuming the 90 days trading horizon PTT Global Chemical is expected to generate 13.98 times more return on investment than Apollo Investment. However, PTT Global is 13.98 times more volatile than Apollo Investment Corp. It trades about 0.03 of its potential returns per unit of risk. Apollo Investment Corp is currently generating about 0.07 per unit of risk. If you would invest 100.00 in PTT Global Chemical on August 31, 2024 and sell it today you would lose (37.00) from holding PTT Global Chemical or give up 37.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PTT Global Chemical vs. Apollo Investment Corp
Performance |
| Timeline |
| PTT Global Chemical |
| Apollo Investment Corp |
PTT Global and Apollo Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PTT Global and Apollo Investment
The main advantage of trading using opposite PTT Global and Apollo Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PTT Global position performs unexpectedly, Apollo Investment 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 Investment will offset losses from the drop in Apollo Investment's long position.The idea behind PTT Global Chemical and Apollo Investment Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Apollo Investment vs. Morgan Stanley | Apollo Investment vs. The Goldman Sachs | Apollo Investment vs. Superior Plus Corp | Apollo Investment vs. NMI Holdings |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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