Correlation Between Trendline and Apple
Can any of the company-specific risk be diversified away by investing in both Trendline 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 Trendline and Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trendline and Apple Inc, you can compare the effects of market volatilities on Trendline 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 Trendline with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trendline and Apple.
Diversification Opportunities for Trendline and Apple
Excellent diversification
The 3 months correlation between Trendline and Apple is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Trendline and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and Trendline 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 Trendline 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 Trendline i.e., Trendline and Apple go up and down completely randomly.
Pair Corralation between Trendline and Apple
Assuming the 90 days trading horizon Trendline is expected to under-perform the Apple. In addition to that, Trendline is 2.37 times more volatile than Apple Inc. It trades about -0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.01 per unit of volatility. If you would invest 16,388 in Apple Inc on December 30, 2023 and sell it today you would earn a total of 760.00 from holding Apple Inc or generate 4.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 78.95% |
Values | Daily Returns |
Trendline vs. Apple Inc
Performance |
Timeline |
Trendline |
Apple Inc |
Trendline and Apple Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Trendline and Apple
The main advantage of trading using opposite Trendline and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trendline 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.Trendline vs. Safe T Group | Trendline vs. WhiteSmoke Software | Trendline vs. Internet Gold Golden | Trendline vs. Inbar Group Finance |
Apple vs. The Singing Machine | Apple vs. VOXX International | Apple vs. Vuzix Corp Cmn | Apple 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
Transaction History View history of all your transactions and understand their impact on performance | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Stocks Directory Find actively traded stocks across global markets | |
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |