Correlation Between Mercantile Bank and Apollo Global
Can any of the company-specific risk be diversified away by investing in both Mercantile Bank 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 Mercantile Bank and Apollo Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mercantile Bank and Apollo Global Management, you can compare the effects of market volatilities on Mercantile Bank 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 Mercantile Bank with a short position of Apollo Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mercantile Bank and Apollo Global.
Diversification Opportunities for Mercantile Bank and Apollo Global
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mercantile and Apollo is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Mercantile Bank 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 Mercantile Bank 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 Mercantile Bank 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 Mercantile Bank i.e., Mercantile Bank and Apollo Global go up and down completely randomly.
Pair Corralation between Mercantile Bank and Apollo Global
Given the investment horizon of 90 days Mercantile Bank is expected to under-perform the Apollo Global. In addition to that, Mercantile Bank is 1.1 times more volatile than Apollo Global Management. It trades about -0.07 of its total potential returns per unit of risk. Apollo Global Management is currently generating about 0.0 per unit of volatility. If you would invest 11,247 in Apollo Global Management on January 29, 2024 and sell it today you would lose (25.00) from holding Apollo Global Management or give up 0.22% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Mercantile Bank vs. Apollo Global Management
Performance |
Timeline |
Mercantile Bank |
Apollo Global Management |
Mercantile Bank and Apollo Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Mercantile Bank and Apollo Global
The main advantage of trading using opposite Mercantile Bank and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mercantile Bank 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.Mercantile Bank vs. Macatawa Bank | Mercantile Bank vs. Great Southern Bancorp | Mercantile Bank vs. First Bancorp | Mercantile Bank vs. MidWestOne Financial Group |
Apollo Global vs. Embrace Change Acquisition | Apollo Global vs. HUMANA INC | Apollo Global vs. Aquagold International | Apollo Global vs. Barloworld Ltd ADR |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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