Correlation Between Apple and Loomis Sayles

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

By analyzing existing cross correlation between Apple Inc and Loomis Sayles Limited, you can compare the effects of market volatilities on Apple and Loomis Sayles 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 Loomis Sayles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Loomis Sayles.

Diversification Opportunities for Apple and Loomis Sayles

0.48

Correlation Coefficient

Apple  Loomis Sayles

Very weak diversification

The 3 months correlation between Apple and Loomis is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Loomis Sayles Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Loomis Sayles Limited 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 Loomis Sayles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Loomis Sayles Limited has no effect on the direction of Apple i.e., Apple and Loomis Sayles go up and down completely randomly.

Pair Corralation between Apple and Loomis Sayles

If you would invest  16,907  in Apple Inc on March 2, 2024 and sell it today you would earn a total of  2,222  from holding Apple Inc or generate 13.14% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Apple Inc  vs.  Loomis Sayles Limited

Apple Inc

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Apple may actually be approaching a critical reversion point that can send shares even higher in July 2024.

Loomis Sayles Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Loomis Sayles Limited has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Loomis Sayles is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Apple and Loomis Sayles

The main advantage of trading using opposite Apple and Loomis Sayles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Loomis Sayles 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 Loomis Sayles will offset losses from the drop in Loomis Sayles' long position.

The idea behind Apple Inc and Loomis Sayles Limited 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.