Correlation Between VICI Properties and Apple

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

By analyzing existing cross correlation between VICI Properties and Apple Inc, you can compare the effects of market volatilities on VICI Properties 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 VICI Properties with a short position of Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of VICI Properties and Apple.

Diversification Opportunities for VICI Properties and Apple

0.62

Correlation Coefficient

VICI Properties  Apple

Poor diversification

The 3 months correlation between VICI and Apple is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding VICI Properties and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and VICI Properties 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 VICI Properties 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 VICI Properties i.e., VICI Properties and Apple go up and down completely randomly.

Pair Corralation between VICI Properties and Apple

Given the investment horizon of 90 days VICI Properties is expected to generate 1.4 times less return on investment than Apple. But when comparing it to its historical volatility, VICI Properties is 1.24 times less risky than Apple. It trades about 0.01 of its potential returns per unit of risk. Apple Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  16,414  in Apple Inc on January 24, 2024 and sell it today you would earn a total of  170.00  from holding Apple Inc or generate 1.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

VICI Properties  vs.  Apple Inc

VICI Properties

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VICI Properties has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong fundamental indicators, VICI Properties is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Apple Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in May 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with VICI Properties and Apple

The main advantage of trading using opposite VICI Properties and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VICI Properties 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.

The idea behind VICI Properties and Apple Inc 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.