Correlation Between Blackstone and Apollo Global

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

Diversification Opportunities for Blackstone and Apollo Global

0.45
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Blackstone and Apollo is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Blackstone Group 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 Blackstone 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 Blackstone Group 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 Blackstone i.e., Blackstone and Apollo Global go up and down completely randomly.

Pair Corralation between Blackstone and Apollo Global

Allowing for the 90-day total investment horizon Blackstone is expected to generate 2.13 times less return on investment than Apollo Global. In addition to that, Blackstone is 1.19 times more volatile than Apollo Global Management. It trades about 0.03 of its total potential returns per unit of risk. Apollo Global Management is currently generating about 0.08 per unit of volatility. If you would invest  5,427  in Apollo Global Management on December 30, 2023 and sell it today you would earn a total of  5,818  from holding Apollo Global Management or generate 107.2% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Blackstone Group  vs.  Apollo Global Management

 Performance 
       Timeline  
Blackstone Group 

Risk-Adjusted Performance

3 of 100

 
Low
 
High
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Blackstone Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Blackstone is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Apollo Global Management 

Risk-Adjusted Performance

21 of 100

 
Low
 
High
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Management are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Apollo Global displayed solid returns over the last few months and may actually be approaching a breakup point.

Blackstone and Apollo Global Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Blackstone and Apollo Global

The main advantage of trading using opposite Blackstone and Apollo Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackstone 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.
The idea behind Blackstone Group and Apollo Global Management 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.
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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