Correlation Between Aptiv PLC and Delphi Technologies

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Can any of the company-specific risk be diversified away by investing in both Aptiv PLC and Delphi Technologies 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 Aptiv PLC and Delphi Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aptiv PLC and Delphi Technologies PLC, you can compare the effects of market volatilities on Aptiv PLC and Delphi Technologies 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 Aptiv PLC with a short position of Delphi Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptiv PLC and Delphi Technologies.

Diversification Opportunities for Aptiv PLC and Delphi Technologies

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  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Aptiv and Delphi is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aptiv PLC and Delphi Technologies PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delphi Technologies PLC and Aptiv PLC 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 Aptiv PLC are associated (or correlated) with Delphi Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delphi Technologies PLC has no effect on the direction of Aptiv PLC i.e., Aptiv PLC and Delphi Technologies go up and down completely randomly.

Pair Corralation between Aptiv PLC and Delphi Technologies

If you would invest  7,883  in Aptiv PLC on December 29, 2023 and sell it today you would lose (19.00) from holding Aptiv PLC or give up 0.24% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Aptiv PLC  vs.  Delphi Technologies PLC

 Performance 
       Timeline  
Aptiv PLC 

Risk-Adjusted Performance

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Over the last 90 days Aptiv PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.
Delphi Technologies PLC 

Risk-Adjusted Performance

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Over the last 90 days Delphi Technologies PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Delphi Technologies is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Aptiv PLC and Delphi Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Aptiv PLC and Delphi Technologies

The main advantage of trading using opposite Aptiv PLC and Delphi Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aptiv PLC position performs unexpectedly, Delphi Technologies 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 Delphi Technologies will offset losses from the drop in Delphi Technologies' long position.
The idea behind Aptiv PLC and Delphi Technologies PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.

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