Correlation Between NAKED WINES and Apple
Can any of the company-specific risk be diversified away by investing in both NAKED WINES 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 NAKED WINES and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAKED WINES PLC and Apple Inc, you can compare the effects of market volatilities on NAKED WINES 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 NAKED WINES with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAKED WINES and Apple.
Diversification Opportunities for NAKED WINES and Apple
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between NAKED and Apple is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding NAKED WINES PLC and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and NAKED WINES 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 NAKED WINES PLC 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 NAKED WINES i.e., NAKED WINES and Apple go up and down completely randomly.
Pair Corralation between NAKED WINES and Apple
Assuming the 90 days horizon NAKED WINES PLC is expected to under-perform the Apple. In addition to that, NAKED WINES is 3.09 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 0.06 per unit of volatility. If you would invest 16,699 in Apple Inc on September 2, 2024 and sell it today you would earn a total of 5,736 from holding Apple Inc or generate 34.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NAKED WINES PLC vs. Apple Inc
Performance |
| Timeline |
| NAKED WINES PLC |
| Apple Inc |
NAKED WINES and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAKED WINES and Apple
The main advantage of trading using opposite NAKED WINES and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAKED WINES 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.| NAKED WINES vs. Superior Plus Corp | NAKED WINES vs. NMI Holdings | NAKED WINES vs. Origin Agritech | NAKED WINES vs. SIVERS SEMICONDUCTORS AB |
| 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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