Correlation Between Apple and Eastman Kodak
Can any of the company-specific risk be diversified away by investing in both Apple and Eastman Kodak 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 Apple and Eastman Kodak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and Eastman Kodak Co, you can compare the effects of market volatilities on Apple and Eastman Kodak 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 Apple with a short position of Eastman Kodak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Eastman Kodak.
Diversification Opportunities for Apple and Eastman Kodak
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Apple and Eastman is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Eastman Kodak Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Kodak and Apple 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 Apple Inc are associated (or correlated) with Eastman Kodak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Kodak has no effect on the direction of Apple i.e., Apple and Eastman Kodak go up and down completely randomly.
Pair Corralation between Apple and Eastman Kodak
Given the investment horizon of 90 days Apple is expected to generate 2.56 times less return on investment than Eastman Kodak. But when comparing it to its historical volatility, Apple Inc is 2.49 times less risky than Eastman Kodak. It trades about 0.01 of its potential returns per unit of risk. Eastman Kodak Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 581.00 in Eastman Kodak Co on January 24, 2024 and sell it today you would lose (115.00) from holding Eastman Kodak Co or give up 19.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Apple Inc vs. Eastman Kodak Co
Performance |
| Timeline |
| Apple Inc |
| Eastman Kodak |
Apple and Eastman Kodak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Apple and Eastman Kodak
The main advantage of trading using opposite Apple and Eastman Kodak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Eastman Kodak 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 Eastman Kodak will offset losses from the drop in Eastman Kodak's long position.The idea behind Apple Inc and Eastman Kodak Co 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.| Eastman Kodak vs. LG Display Co | Eastman Kodak vs. Sony Corp | Eastman Kodak vs. Sonos Inc | Eastman Kodak vs. Vizio Holding Corp |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |