Correlation Between Sensient Technologies and APPLE
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By analyzing existing cross correlation between Sensient Technologies and APPLE INC, you can compare the effects of market volatilities on Sensient Technologies 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 Sensient Technologies with a short position of APPLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sensient Technologies and APPLE.
Diversification Opportunities for Sensient Technologies and APPLE
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sensient and APPLE is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Sensient Technologies and APPLE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPLE INC and Sensient Technologies 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 Sensient Technologies 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 Sensient Technologies i.e., Sensient Technologies and APPLE go up and down completely randomly.
Pair Corralation between Sensient Technologies and APPLE
Considering the 90-day investment horizon Sensient Technologies is expected to generate 2.73 times more return on investment than APPLE. However, Sensient Technologies is 2.73 times more volatile than APPLE INC. It trades about -0.02 of its potential returns per unit of risk. APPLE INC is currently generating about -0.22 per unit of risk. If you would invest 7,794 in Sensient Technologies on August 30, 2024 and sell it today you would lose (85.00) from holding Sensient Technologies or give up 1.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Sensient Technologies vs. APPLE INC
Performance |
| Timeline |
| Sensient Technologies |
| APPLE INC |
Sensient Technologies and APPLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sensient Technologies and APPLE
The main advantage of trading using opposite Sensient Technologies and APPLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sensient Technologies 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.| Sensient Technologies vs. Innospec | Sensient Technologies vs. Minerals Technologies | Sensient Technologies vs. Oil Dri | Sensient Technologies vs. H B Fuller |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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