Correlation Between Micron Technology, and Apple

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Can any of the company-specific risk be diversified away by investing in both Micron Technology, 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 Micron Technology, and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology, and Apple Inc CDR, you can compare the effects of market volatilities on Micron Technology, 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 Micron Technology, with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology, and Apple.

Diversification Opportunities for Micron Technology, and Apple

MicronAppleDiversified AwayMicronAppleDiversified Away100%
-0.5
  Correlation Coefficient

Very good diversification

The 3 months correlation between Micron and Apple is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology, and Apple Inc CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc CDR and Micron Technology, 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 Micron Technology, 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 CDR has no effect on the direction of Micron Technology, i.e., Micron Technology, and Apple go up and down completely randomly.

Pair Corralation between Micron Technology, and Apple

Assuming the 90 days trading horizon Micron Technology, is expected to under-perform the Apple. In addition to that, Micron Technology, is 1.93 times more volatile than Apple Inc CDR. It trades about -0.09 of its total potential returns per unit of risk. Apple Inc CDR is currently generating about -0.09 per unit of volatility. If you would invest  3,584  in Apple Inc CDR on November 5, 2024 and sell it today you would lose (138.00) from holding Apple Inc CDR or give up 3.85% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Micron Technology,  vs.  Apple Inc CDR

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -20-15-10-50510
JavaScript chart by amCharts 3.21.15MU AAPL
       Timeline  
Micron Technology, 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Micron Technology, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.
JavaScript chart by amCharts 3.21.15DecJanJanFeb20212223242526
Apple Inc CDR 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc CDR are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Apple is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15DecJanJanFeb323334353637

Micron Technology, and Apple Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.49-4.86-3.23-1.60.021.553.114.666.22 0.050.100.150.20
JavaScript chart by amCharts 3.21.15MU AAPL
       Returns  

Pair Trading with Micron Technology, and Apple

The main advantage of trading using opposite Micron Technology, and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology, 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 Micron Technology, and Apple Inc CDR 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.
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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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.

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