Correlation Between STORE ELECTRONIC and Apple
Can any of the company-specific risk be diversified away by investing in both STORE ELECTRONIC 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 STORE ELECTRONIC and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STORE ELECTRONIC and Apple Inc, you can compare the effects of market volatilities on STORE ELECTRONIC 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 STORE ELECTRONIC with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of STORE ELECTRONIC and Apple.
Diversification Opportunities for STORE ELECTRONIC and Apple
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between STORE and Apple is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding STORE ELECTRONIC and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and STORE ELECTRONIC 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 STORE ELECTRONIC 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 STORE ELECTRONIC i.e., STORE ELECTRONIC and Apple go up and down completely randomly.
Pair Corralation between STORE ELECTRONIC and Apple
Assuming the 90 days trading horizon STORE ELECTRONIC is expected to under-perform the Apple. In addition to that, STORE ELECTRONIC is 1.48 times more volatile than Apple Inc. It trades about -0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.12 per unit of volatility. If you would invest 17,637 in Apple Inc on August 26, 2024 and sell it today you would earn a total of 4,418 from holding Apple Inc or generate 25.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STORE ELECTRONIC vs. Apple Inc
Performance |
| Timeline |
| STORE ELECTRONIC |
| Apple Inc |
STORE ELECTRONIC and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STORE ELECTRONIC and Apple
The main advantage of trading using opposite STORE ELECTRONIC and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STORE ELECTRONIC 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.| STORE ELECTRONIC vs. TERADATA | STORE ELECTRONIC vs. Nok Airlines PCL | STORE ELECTRONIC vs. Data3 Limited | STORE ELECTRONIC vs. Automatic Data Processing |
| Apple vs. ARROW ELECTRONICS | Apple vs. Richardson Electronics | Apple vs. STORE ELECTRONIC | Apple vs. Samsung Electronics Co |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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