Correlation Between NYSE Composite and Apollo Senior
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Apollo Senior 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 NYSE Composite and Apollo Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Apollo Senior Floating, you can compare the effects of market volatilities on NYSE Composite and Apollo Senior 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 NYSE Composite with a short position of Apollo Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Apollo Senior.
Diversification Opportunities for NYSE Composite and Apollo Senior
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between NYSE and Apollo is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Apollo Senior Floating in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Senior Floating and NYSE Composite 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 NYSE Composite are associated (or correlated) with Apollo Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Senior Floating has no effect on the direction of NYSE Composite i.e., NYSE Composite and Apollo Senior go up and down completely randomly.
Pair Corralation between NYSE Composite and Apollo Senior
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.57 times less return on investment than Apollo Senior. In addition to that, NYSE Composite is 1.08 times more volatile than Apollo Senior Floating. It trades about 0.08 of its total potential returns per unit of risk. Apollo Senior Floating is currently generating about 0.14 per unit of volatility. If you would invest 1,031 in Apollo Senior Floating on August 28, 2024 and sell it today you would earn a total of 455.00 from holding Apollo Senior Floating or generate 44.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 81.85% |
| Values | Daily Returns |
NYSE Composite vs. Apollo Senior Floating
Performance |
| Timeline |
NYSE Composite and Apollo Senior Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Apollo Senior Floating
Pair trading matchups for Apollo Senior
Pair Trading with NYSE Composite and Apollo Senior
The main advantage of trading using opposite NYSE Composite and Apollo Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Apollo Senior 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 Apollo Senior will offset losses from the drop in Apollo Senior's long position.| NYSE Composite vs. Vita Coco | NYSE Composite vs. Franklin Wireless Corp | NYSE Composite vs. Ambev SA ADR | NYSE Composite vs. Toro Co |
| Apollo Senior vs. Blackstone Gso Strategic | Apollo Senior vs. First Trust Senior | Apollo Senior vs. BlackRock Floating Rate | Apollo Senior vs. Eaton Vance Senior |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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