Correlation Between Melco Resorts and Apple
Can any of the company-specific risk be diversified away by investing in both Melco Resorts 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 Melco Resorts and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Melco Resorts Entertainment and Apple Inc, you can compare the effects of market volatilities on Melco Resorts 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 Melco Resorts with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Melco Resorts and Apple.
Diversification Opportunities for Melco Resorts and Apple
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Melco and Apple is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Melco Resorts Entertainment and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Melco Resorts 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 Melco Resorts Entertainment 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 Melco Resorts i.e., Melco Resorts and Apple go up and down completely randomly.
Pair Corralation between Melco Resorts and Apple
Assuming the 90 days trading horizon Melco Resorts Entertainment is expected to under-perform the Apple. In addition to that, Melco Resorts is 1.65 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 0.14 per unit of volatility. If you would invest 20,461 in Apple Inc on November 1, 2024 and sell it today you would earn a total of 2,409 from holding Apple Inc or generate 11.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Melco Resorts Entertainment vs. Apple Inc
Performance |
| Timeline |
| Melco Resorts Entert |
| Apple Inc |
Melco Resorts and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Melco Resorts and Apple
The main advantage of trading using opposite Melco Resorts and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Melco Resorts 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.| Melco Resorts vs. Carnegie Clean Energy | Melco Resorts vs. Sunny Optical Technology | Melco Resorts vs. Vishay Intertechnology | Melco Resorts vs. Cognizant Technology Solutions |
| Apple vs. Dalata Hotel Group | Apple vs. GEELY AUTOMOBILE | Apple vs. Grupo Carso SAB | Apple vs. INTERCONT HOTELS |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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