Correlation Between APPTECH CORP and Altair Engineering

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

Diversification Opportunities for APPTECH CORP and Altair Engineering

0.52
  Correlation Coefficient

Very weak diversification

The 3 months correlation between APPTECH and Altair is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding APPTECH CORP and Altair Engineering Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altair Engineering and APPTECH CORP 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 APPTECH CORP are associated (or correlated) with Altair Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altair Engineering has no effect on the direction of APPTECH CORP i.e., APPTECH CORP and Altair Engineering go up and down completely randomly.

Pair Corralation between APPTECH CORP and Altair Engineering

Given the investment horizon of 90 days APPTECH CORP is expected to under-perform the Altair Engineering. In addition to that, APPTECH CORP is 3.85 times more volatile than Altair Engineering. It trades about -0.08 of its total potential returns per unit of risk. Altair Engineering is currently generating about -0.03 per unit of volatility. If you would invest  5,494  in Altair Engineering on April 6, 2022 and sell it today you would lose (147.00)  from holding Altair Engineering or give up 2.68% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

APPTECH CORP  vs.  Altair Engineering Inc

 Performance (%) 
      Timeline 
APPTECH CORP 
APPTECH Performance
0 of 100
Over the last 90 days APPTECH CORP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of sluggish performance in the last few months, the Stock's fundamental indicators remain fairly strong which may send shares a bit higher in August 2022. The current disturbance may also be a sign of long term up-swing for the company investors.

Structure and Payout Changes

Last Split Factor
1:9
Last Split Date
2022-01-05

APPTECH Price Channel

Altair Engineering 
Altair Performance
0 of 100
Over the last 90 days Altair Engineering has generated negative risk-adjusted returns adding no value to investors with long positions. Even with sluggish performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in August 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Altair Price Channel

APPTECH CORP and Altair Engineering Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with APPTECH CORP and Altair Engineering

The main advantage of trading using opposite APPTECH CORP and Altair Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if APPTECH CORP position performs unexpectedly, Altair Engineering 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 Altair Engineering will offset losses from the drop in Altair Engineering's long position.
The idea behind APPTECH CORP and Altair Engineering 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.

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