Correlation Between Subsea 7 and Apple
Can any of the company-specific risk be diversified away by investing in both Subsea 7 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 Subsea 7 and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Subsea 7 SA and Apple Inc, you can compare the effects of market volatilities on Subsea 7 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 Subsea 7 with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Subsea 7 and Apple.
Diversification Opportunities for Subsea 7 and Apple
Poor diversification
The 3 months correlation between Subsea and Apple is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Subsea 7 SA and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Subsea 7 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 Subsea 7 SA 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 Subsea 7 i.e., Subsea 7 and Apple go up and down completely randomly.
Pair Corralation between Subsea 7 and Apple
If you would invest 1,262 in Subsea 7 SA on January 26, 2024 and sell it today you would earn a total of 0.00 from holding Subsea 7 SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Subsea 7 SA vs. Apple Inc
Performance |
| Timeline |
| Subsea 7 SA |
| Apple Inc |
Subsea 7 and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Subsea 7 and Apple
The main advantage of trading using opposite Subsea 7 and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Subsea 7 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.| Subsea 7 vs. Fiserv Inc | Subsea 7 vs. Schlumberger NV | Subsea 7 vs. Halliburton | Subsea 7 vs. Baker Hughes 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 AI Investment Finder module to use AI to screen and filter profitable investment opportunities.
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