Correlation Between Swift Foods and Apollo Global
Can any of the company-specific risk be diversified away by investing in both Swift Foods and Apollo Global 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 Swift Foods and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swift Foods and Apollo Global Capital, you can compare the effects of market volatilities on Swift Foods and Apollo Global 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 Swift Foods with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swift Foods and Apollo Global.
Diversification Opportunities for Swift Foods and Apollo Global
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Swift and Apollo is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Swift Foods and Apollo Global Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Global Capital and Swift Foods 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 Swift Foods are associated (or correlated) with Apollo Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Global Capital has no effect on the direction of Swift Foods i.e., Swift Foods and Apollo Global go up and down completely randomly.
Pair Corralation between Swift Foods and Apollo Global
Assuming the 90 days trading horizon Swift Foods is expected to generate 1.11 times more return on investment than Apollo Global. However, Swift Foods is 1.11 times more volatile than Apollo Global Capital. It trades about 0.01 of its potential returns per unit of risk. Apollo Global Capital is currently generating about -0.08 per unit of risk. If you would invest 6.40 in Swift Foods on September 1, 2024 and sell it today you would lose (0.60) from holding Swift Foods or give up 9.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 87.5% |
| Values | Daily Returns |
Swift Foods vs. Apollo Global Capital
Performance |
| Timeline |
| Swift Foods |
| Apollo Global Capital |
Swift Foods and Apollo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swift Foods and Apollo Global
The main advantage of trading using opposite Swift Foods and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swift Foods position performs unexpectedly, Apollo Global 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 Global will offset losses from the drop in Apollo Global's long position.| Swift Foods vs. Metro Retail Stores | Swift Foods vs. Century Pacific Food | Swift Foods vs. Manila Mining Corp | Swift Foods vs. Apex Mining 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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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