Correlation Between KSB SE and Apple
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By analyzing existing cross correlation between KSB SE Co and Apple Inc, you can compare the effects of market volatilities on KSB SE 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 KSB SE with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of KSB SE and Apple.
Diversification Opportunities for KSB SE and Apple
Poor diversification
The 3 months correlation between KSB and Apple is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding KSB SE Co and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and KSB SE 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 KSB SE Co 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 KSB SE i.e., KSB SE and Apple go up and down completely randomly.
Pair Corralation between KSB SE and Apple
Assuming the 90 days trading horizon KSB SE is expected to generate 3.25 times less return on investment than Apple. In addition to that, KSB SE is 1.13 times more volatile than Apple Inc. It trades about 0.11 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 | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KSB SE Co vs. Apple Inc
Performance |
| Timeline |
| KSB SE |
| Apple Inc |
KSB SE and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KSB SE and Apple
The main advantage of trading using opposite KSB SE and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KSB SE 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.The idea behind KSB SE Co and Apple Inc 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.| 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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