Correlation Between Alfa Laval and Apple
Can any of the company-specific risk be diversified away by investing in both Alfa Laval 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 Alfa Laval and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfa Laval AB and Apple Inc, you can compare the effects of market volatilities on Alfa Laval 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 Alfa Laval with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfa Laval and Apple.
Diversification Opportunities for Alfa Laval and Apple
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Alfa and Apple is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Alfa Laval AB and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Alfa Laval 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 Alfa Laval AB 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 Alfa Laval i.e., Alfa Laval and Apple go up and down completely randomly.
Pair Corralation between Alfa Laval and Apple
If you would invest 3,700 in Alfa Laval AB on January 25, 2024 and sell it today you would earn a total of 0.00 from holding Alfa Laval AB or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 95.45% |
Values | Daily Returns |
Alfa Laval AB vs. Apple Inc
Performance |
Timeline |
Alfa Laval AB |
Apple Inc |
Alfa Laval and Apple Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Alfa Laval and Apple
The main advantage of trading using opposite Alfa Laval and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfa Laval 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.Alfa Laval vs. GE Aerospace | Alfa Laval vs. Eaton PLC | Alfa Laval vs. Illinois Tool Works | Alfa Laval vs. Parker Hannifin |
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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