Correlation Between Apptech Corp and Saker Aviation

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

Diversification Opportunities for Apptech Corp and Saker Aviation

0.24
  Correlation Coefficient

Modest diversification

The 3 months correlation between Apptech and Saker is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Apptech Corp and Saker Aviation Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saker Aviation Services 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 Saker Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saker Aviation Services has no effect on the direction of Apptech Corp i.e., Apptech Corp and Saker Aviation go up and down completely randomly.

Pair Corralation between Apptech Corp and Saker Aviation

Given the investment horizon of 90 days Apptech Corp is expected to generate 2.28 times more return on investment than Saker Aviation. However, Apptech Corp is 2.28 times more volatile than Saker Aviation Services. It trades about 0.15 of its potential returns per unit of risk. Saker Aviation Services is currently generating about 0.19 per unit of risk. If you would invest  82.00  in Apptech Corp on September 5, 2022 and sell it today you would earn a total of  16.00  from holding Apptech Corp or generate 19.51% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Apptech Corp  vs.  Saker Aviation Services

 Performance (%) 
       Timeline  
Apptech Corp 
Apptech Performance
8 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Apptech Corp are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal fundamental indicators, Apptech Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Apptech Price Channel

Saker Aviation Services 
Saker Performance
10 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Saker Aviation Services are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Saker Aviation reported solid returns over the last few months and may actually be approaching a breakup point.

Saker Price Channel

Apptech Corp and Saker Aviation Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Apptech Corp and Saker Aviation

The main advantage of trading using opposite Apptech Corp and Saker Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apptech Corp position performs unexpectedly, Saker Aviation 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 Saker Aviation will offset losses from the drop in Saker Aviation's long position.
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The idea behind Apptech Corp and Saker Aviation Services 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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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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