Correlation Between Hamilton Insurance and Apollo Global

Can any of the company-specific risk be diversified away by investing in both Hamilton Insurance 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 Hamilton Insurance and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hamilton Insurance Group and Apollo Global Management, you can compare the effects of market volatilities on Hamilton Insurance 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 Hamilton Insurance with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hamilton Insurance and Apollo Global.

Diversification Opportunities for Hamilton Insurance and Apollo Global

0.34

Correlation Coefficient

Hamilton Insurance  Apollo Global

Weak diversification

The 3 months correlation between Hamilton and Apollo is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton Insurance Group 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 Hamilton Insurance 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 Hamilton Insurance Group 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 Hamilton Insurance i.e., Hamilton Insurance and Apollo Global go up and down completely randomly.

Pair Corralation between Hamilton Insurance and Apollo Global

Allowing for the 90-day total investment horizon Hamilton Insurance Group is expected to generate 1.39 times more return on investment than Apollo Global. However, Hamilton Insurance is 1.39 times more volatile than Apollo Global Management. It trades about 0.16 of its potential returns per unit of risk. Apollo Global Management is currently generating about 0.05 per unit of risk. If you would invest  1,351  in Hamilton Insurance Group on February 29, 2024 and sell it today you would earn a total of  319.00  from holding Hamilton Insurance Group or generate 23.61% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Hamilton Insurance Group  vs.  Apollo Global Management

Hamilton Insurance

Risk-Adjusted Performance

12 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hamilton Insurance Group are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Hamilton Insurance reported solid returns over the last few months and may actually be approaching a breakup point.

Apollo Global Management

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Management are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Apollo Global is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Hamilton Insurance and Apollo Global

The main advantage of trading using opposite Hamilton Insurance and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hamilton Insurance 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.

The idea behind Hamilton Insurance Group and Apollo Global Management 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.