Correlation Between SHIN-ETSU CHEMICAL and Apple
Can any of the company-specific risk be diversified away by investing in both SHIN-ETSU CHEMICAL 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 SHIN-ETSU CHEMICAL and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHIN ETSU CHEMICAL and Apple Inc, you can compare the effects of market volatilities on SHIN-ETSU CHEMICAL 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 SHIN-ETSU CHEMICAL with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHIN-ETSU CHEMICAL and Apple.
Diversification Opportunities for SHIN-ETSU CHEMICAL and Apple
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SHIN-ETSU and Apple is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding SHIN ETSU CHEMICAL and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and SHIN-ETSU CHEMICAL 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 SHIN ETSU CHEMICAL 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 SHIN-ETSU CHEMICAL i.e., SHIN-ETSU CHEMICAL and Apple go up and down completely randomly.
Pair Corralation between SHIN-ETSU CHEMICAL and Apple
Assuming the 90 days trading horizon SHIN-ETSU CHEMICAL is expected to generate 15.39 times less return on investment than Apple. In addition to that, SHIN-ETSU CHEMICAL is 1.44 times more volatile than Apple Inc. It trades about 0.02 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.36 per unit of volatility. If you would invest 20,575 in Apple Inc on September 1, 2024 and sell it today you would earn a total of 1,860 from holding Apple Inc or generate 9.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
SHIN ETSU CHEMICAL vs. Apple Inc
Performance |
| Timeline |
| SHIN ETSU CHEMICAL |
| Apple Inc |
SHIN-ETSU CHEMICAL and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHIN-ETSU CHEMICAL and Apple
The main advantage of trading using opposite SHIN-ETSU CHEMICAL and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHIN-ETSU CHEMICAL 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.| SHIN-ETSU CHEMICAL vs. National Retail Properties | SHIN-ETSU CHEMICAL vs. RETAIL FOOD GROUP | SHIN-ETSU CHEMICAL vs. Fast Retailing Co | SHIN-ETSU CHEMICAL vs. SERI INDUSTRIAL EO |
| Apple vs. Enter Air SA | Apple vs. Wayside Technology Group | Apple vs. DELTA AIR LINES | Apple vs. Align Technology |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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