Correlation Between Apple and Harman International

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

Diversification Opportunities for Apple and Harman International

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Apple and Harman is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Harman International Industrie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harman International 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 Harman International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harman International has no effect on the direction of Apple i.e., Apple and Harman International go up and down completely randomly.

Pair Corralation between Apple and Harman International

If you would invest  14,979  in Apple Inc on December 29, 2023 and sell it today you would earn a total of  2,352  from holding Apple Inc or generate 15.7% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Apple Inc  vs.  Harman International Industrie

 Performance 
       Timeline  
Apple Inc 

Risk-Adjusted Performance

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Over the last 90 days Apple Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.
Harman International 

Risk-Adjusted Performance

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Low
 
High
Very Weak
Over the last 90 days Harman International Industries has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Harman International is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

Apple and Harman International Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Apple and Harman International

The main advantage of trading using opposite Apple and Harman International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Harman International 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 Harman International will offset losses from the drop in Harman International's long position.
The idea behind Apple Inc and Harman International Industries 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.

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