Correlation Between G-III Apparel and Apple
Can any of the company-specific risk be diversified away by investing in both G-III Apparel 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 G-III Apparel and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between G III Apparel Group and Apple Inc, you can compare the effects of market volatilities on G-III Apparel 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 G-III Apparel with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of G-III Apparel and Apple.
Diversification Opportunities for G-III Apparel and Apple
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between G-III and Apple is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding G III Apparel Group and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and G-III Apparel 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 G III Apparel Group 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 G-III Apparel i.e., G-III Apparel and Apple go up and down completely randomly.
Pair Corralation between G-III Apparel and Apple
Assuming the 90 days trading horizon G-III Apparel is expected to generate 8.46 times less return on investment than Apple. In addition to that, G-III Apparel is 1.76 times more volatile than Apple Inc. It trades about 0.03 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.39 per unit of volatility. If you would invest 20,461 in Apple Inc on September 2, 2024 and sell it today you would earn a total of 1,974 from holding Apple Inc or generate 9.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
G III Apparel Group vs. Apple Inc
Performance |
| Timeline |
| G III Apparel |
| Apple Inc |
G-III Apparel and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with G-III Apparel and Apple
The main advantage of trading using opposite G-III Apparel and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if G-III Apparel 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.| G-III Apparel vs. ASURE SOFTWARE | G-III Apparel vs. Rogers Communications | G-III Apparel vs. AXWAY SOFTWARE EO | G-III Apparel vs. Chunghwa Telecom Co |
| Apple vs. Strategic Investments AS | Apple vs. Gladstone Investment | Apple vs. SEI INVESTMENTS | Apple vs. EAT WELL INVESTMENT |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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