Correlation Between X FAB and Apollo Investment
Can any of the company-specific risk be diversified away by investing in both X FAB and Apollo Investment 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 X FAB and Apollo Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between X FAB Silicon Foundries and Apollo Investment Corp, you can compare the effects of market volatilities on X FAB and Apollo Investment 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 X FAB with a short position of Apollo Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of X FAB and Apollo Investment.
Diversification Opportunities for X FAB and Apollo Investment
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between XFB and Apollo is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding X FAB Silicon Foundries and Apollo Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Investment Corp and X FAB 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 X FAB Silicon Foundries are associated (or correlated) with Apollo Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Investment Corp has no effect on the direction of X FAB i.e., X FAB and Apollo Investment go up and down completely randomly.
Pair Corralation between X FAB and Apollo Investment
Assuming the 90 days trading horizon X FAB Silicon Foundries is expected to generate 2.26 times more return on investment than Apollo Investment. However, X FAB is 2.26 times more volatile than Apollo Investment Corp. It trades about 0.06 of its potential returns per unit of risk. Apollo Investment Corp is currently generating about -0.1 per unit of risk. If you would invest 501.00 in X FAB Silicon Foundries on October 12, 2024 and sell it today you would earn a total of 11.00 from holding X FAB Silicon Foundries or generate 2.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
X FAB Silicon Foundries vs. Apollo Investment Corp
Performance |
| Timeline |
| X FAB Silicon |
| Apollo Investment Corp |
X FAB and Apollo Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with X FAB and Apollo Investment
The main advantage of trading using opposite X FAB and Apollo Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if X FAB position performs unexpectedly, Apollo Investment 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 Investment will offset losses from the drop in Apollo Investment's long position.| X FAB vs. Zijin Mining Group | X FAB vs. Forsys Metals Corp | X FAB vs. ScanSource | X FAB vs. Perseus Mining Limited |
| Apollo Investment vs. X FAB Silicon Foundries | Apollo Investment vs. AIR PRODCHEMICALS | Apollo Investment vs. SILICON LABORATOR | Apollo Investment vs. China BlueChemical |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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