Correlation Between Semiconductor Bear and APPTECH CORP

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Can any of the company-specific risk be diversified away by investing in both Semiconductor Bear and APPTECH CORP 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 Semiconductor Bear and APPTECH CORP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Semiconductor Bear 3X and APPTECH CORP, you can compare the effects of market volatilities on Semiconductor Bear and APPTECH CORP 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 Semiconductor Bear with a short position of APPTECH CORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Semiconductor Bear and APPTECH CORP.

Diversification Opportunities for Semiconductor Bear and APPTECH CORP

-0.57
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Semiconductor and APPTECH is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Semiconductor Bear 3X and APPTECH CORP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APPTECH CORP and Semiconductor Bear 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 Semiconductor Bear 3X are associated (or correlated) with APPTECH CORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APPTECH CORP has no effect on the direction of Semiconductor Bear i.e., Semiconductor Bear and APPTECH CORP go up and down completely randomly.

Pair Corralation between Semiconductor Bear and APPTECH CORP

Given the investment horizon of 90 days Semiconductor Bear 3X is expected to generate 1.81 times more return on investment than APPTECH CORP. However, Semiconductor Bear is 1.81 times more volatile than APPTECH CORP. It trades about 0.04 of its potential returns per unit of risk. APPTECH CORP is currently generating about 0.05 per unit of risk. If you would invest  5,405  in Semiconductor Bear 3X on July 6, 2022 and sell it today you would earn a total of  15.00  from holding Semiconductor Bear 3X or generate 0.28% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Semiconductor Bear 3X  vs.  APPTECH CORP

 Performance (%) 
       Timeline  
Semiconductor Bear 
Semiconductor Performance
0 of 100
Over the last 90 days Semiconductor Bear 3X has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Etf's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the ETF retail investors.

Semiconductor Price Channel

APPTECH CORP 
APPTECH Performance
6 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in APPTECH CORP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady fundamental indicators, APPTECH CORP showed solid returns over the last few months and may actually be approaching a breakup point.

APPTECH Price Channel

Semiconductor Bear and APPTECH CORP Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Semiconductor Bear and APPTECH CORP

The main advantage of trading using opposite Semiconductor Bear and APPTECH CORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Semiconductor Bear position performs unexpectedly, APPTECH CORP 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 APPTECH CORP will offset losses from the drop in APPTECH CORP's long position.
Semiconductor Bear vs. Walt Disney
The idea behind Semiconductor Bear 3X and APPTECH CORP 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.

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