Correlation Between TPG and Apollo Global
Can any of the company-specific risk be diversified away by investing in both TPG 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 TPG and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TPG Inc and Apollo Global Management, you can compare the effects of market volatilities on TPG 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 TPG with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of TPG and Apollo Global.
Diversification Opportunities for TPG and Apollo Global
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TPG and Apollo is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding TPG Inc and Apollo Global Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Global Management and TPG 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 TPG Inc 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 Management has no effect on the direction of TPG i.e., TPG and Apollo Global go up and down completely randomly.
Pair Corralation between TPG and Apollo Global
Considering the 90-day investment horizon TPG Inc is expected to under-perform the Apollo Global. In addition to that, TPG is 1.11 times more volatile than Apollo Global Management. It trades about -0.01 of its total potential returns per unit of risk. Apollo Global Management is currently generating about 0.05 per unit of volatility. If you would invest 16,245 in Apollo Global Management on November 8, 2024 and sell it today you would earn a total of 243.00 from holding Apollo Global Management or generate 1.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TPG Inc vs. Apollo Global Management
Performance |
| Timeline |
| TPG Inc |
| Apollo Global Management |
TPG and Apollo Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TPG and Apollo Global
The main advantage of trading using opposite TPG and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TPG 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.| TPG vs. Ares Management LP | TPG vs. Patria Investments | TPG vs. Apollo Global Management | TPG vs. Cion Investment Corp |
| Apollo Global vs. Carlyle Group | Apollo Global vs. Blackstone Group | Apollo Global vs. Brookfield Asset Management | Apollo Global vs. Ares Management LP |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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