Pair Correlation Between Apple and Alcoa

This module allows you to analyze existing cross correlation between Apple Inc and Alcoa Inc. You can compare the effects of market volatilities on Apple and Alcoa 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 Alcoa. See also your portfolio center. Please also check ongoing floating volatility patterns of Apple and Alcoa.
Investment Horizon     30 Days    Login   to change
 Apple Inc.  vs   Alcoa Inc.
 Performance (%) 
Benchmark  Embed    Timeline 

Pair Volatility

Given the investment horizon of 30 days, Apple Inc is expected to generate 0.23 times more return on investment than Alcoa. However, Apple Inc is 4.36 times less risky than Alcoa. It trades about 0.2 of its potential returns per unit of risk. Alcoa Inc is currently generating about -0.06 per unit of risk. If you would invest  13,653  in Apple Inc on February 23, 2017 and sell it today you would earn a total of  413.08  from holding Apple Inc or generate 3.03% return on investment over 30 days.
Correlation Coefficient
Pair Corralation between Apple and Alcoa
-0.07

Parameters

Time Period1 Month [change]
DirectionNegative AAPL Moved Down vs AA
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Diversification

Good diversification

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

Comparative Volatility

 Predicted Return Density 
Benchmark  Embed    Returns 

Apple Inc

  
13 

Risk-Adjusted Performance

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 30 days.

Alcoa Inc

  
0 

Risk-Adjusted Performance

Over the last 30 days Alcoa Inc has generated negative risk-adjusted returns adding no value to investors with long positions.