Correlation Between Apollo Investment and Addtech AB

Can any of the company-specific risk be diversified away by investing in both Apollo Investment and Addtech AB 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 Apollo Investment and Addtech AB into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apollo Investment Corp and Addtech AB, you can compare the effects of market volatilities on Apollo Investment and Addtech AB 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 Apollo Investment with a short position of Addtech AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Investment and Addtech AB.

Diversification Opportunities for Apollo Investment and Addtech AB

0.41

Correlation Coefficient

Apollo Investment  Addtech AB

Very weak diversification

The 3 months correlation between Apollo and Addtech is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Investment Corp and Addtech AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Addtech AB and Apollo Investment 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 Apollo Investment Corp are associated (or correlated) with Addtech AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Addtech AB has no effect on the direction of Apollo Investment i.e., Apollo Investment and Addtech AB go up and down completely randomly.

Pair Corralation between Apollo Investment and Addtech AB

Assuming the 90 days trading horizon Apollo Investment Corp is expected to generate 0.59 times more return on investment than Addtech AB. However, Apollo Investment Corp is 1.7 times less risky than Addtech AB. It trades about 0.0 of its potential returns per unit of risk. Addtech AB is currently generating about -0.04 per unit of risk. If you would invest  1,088  in Apollo Investment Corp on May 15, 2025 and sell it today you would lose (4.00) from holding Apollo Investment Corp or give up 0.37% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Apollo Investment Corp  vs.  Addtech AB

Apollo Investment Corp

Risk-Adjusted Performance

Weakest

Over the last 90 days Apollo Investment Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Apollo Investment is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Addtech AB

Risk-Adjusted Performance

Weakest

Over the last 90 days Addtech AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Addtech AB is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Apollo Investment and Addtech AB

The main advantage of trading using opposite Apollo Investment and Addtech AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apollo Investment position performs unexpectedly, Addtech AB 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 Addtech AB will offset losses from the drop in Addtech AB's long position.

The idea behind Apollo Investment Corp and Addtech AB 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.