Correlation Between Apple and PAR Technology

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Can any of the company-specific risk be diversified away by investing in both Apple and PAR Technology 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 PAR Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Apple Inc and PAR Technology, you can compare the effects of market volatilities on Apple and PAR Technology 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 PAR Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and PAR Technology.

Diversification Opportunities for Apple and PAR Technology

  Correlation Coefficient

Poor diversification

The 3 months correlation between Apple and PAR Technology is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and PAR Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PAR Technology 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 PAR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PAR Technology has no effect on the direction of Apple i.e., Apple and PAR Technology go up and down completely randomly.

Pair Corralation between Apple and PAR Technology

Given the investment horizon of 90 days Apple Inc is expected to generate 0.52 times more return on investment than PAR Technology. However, Apple Inc is 1.91 times less risky than PAR Technology. It trades about 0.16 of its potential returns per unit of risk. PAR Technology is currently generating about -0.2 per unit of risk. If you would invest  14,848  in Apple Inc on December 20, 2022 and sell it today you would earn a total of  652.00  from holding Apple Inc or generate 4.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
ValuesDaily Returns

Apple Inc  vs.  PAR Technology

 Performance (%) 
Apple Inc 

Apple Performance

12 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite inconsistent basic indicators, Apple disclosed solid returns over the last few months and may actually be approaching a breakup point.
PAR Technology 

PAR Technology Performance

15 of 100

Compared to the overall equity markets, risk-adjusted returns on investments in PAR Technology are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Even with relatively inconsistent basic indicators, PAR Technology reported solid returns over the last few months and may actually be approaching a breakup point.

Apple and PAR Technology Volatility Contrast

   Predicted Return Density   

Pair Trading with Apple and PAR Technology

The main advantage of trading using opposite Apple and PAR Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, PAR Technology 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 PAR Technology will offset losses from the drop in PAR Technology's long position.
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The idea behind Apple Inc and PAR Technology 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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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.

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